Macro Playlist

Last Friday, Statistics Canada reported that the Canadian economy added 18,000 jobs in June, following a much stronger gain in May. At first glance, the picture appears mixed: despite the recent rebound, total employment remains slightly below where it started the year.

But, that headline figure masks an important reality.

As the chart illustrates, Canada's population growth has slowed dramatically due to changes in immigration policy. With the population now shrinking, it is only natural that job creation has slowed as well. In this environment, the number of jobs created is becoming a less informative indicator than the unemployment rate.

And the unemployment rate tells a more encouraging story. After peaking at 7.0% in the third quarter of 2025, it averaged 6.7% in the second quarter of 2026 and fell to 6.5% in June. This points to a gradual improvement in labour market conditions across the country.

Despite modest economic growth, the stabilization of the labour market is a positive signal for the Canadian economy. The status quo in Canada–U.S. trade relations, despite ongoing noise surrounding bridges or the USMCA renewal process, is certainly helping. Low policy rates, which are expected to remain in place for the coming months, continue to support economic activity. Finally, the Carney government's investment program is boosting growth and improving the outlook for Canadian businesses.