Preview: Due September 4 - Canada August Employment - A moderate month after a very strong one
We expect Canadian employment to increase by 20k in August, a moderate gain to follow a very strong 75.1k in July, similar to the moderate 18.2k increase in June that followed a very strong rise of 87.8k in May. We expect unemployment to hold at 6.4%, after three straight declines.
This would be consistent with an economy continuing a recent return to growth after a pause initiated in Q2 2025 by US tariffs. We expect the job gain to be led by a 15k rise in full time work, with part time up by 5k.
Manufacturing and construction both saw strong gains in May and July with dips in June. For August we expect a 5k dip in manufacturing and flat construction, with overall goods employment falling by 10k with mining also slipping. We expect services to rise by 30k, respectable but down from gains exceeding 60k in June and July, and close to 50k in May. The service detail is likely to be broadly modestly positive. The public sector may produce an above trend month after slippage in June and July, though this may be balanced by a correction from a strong July in self-employment. We expect a 20k rise in private sector employment, respectable but like services a four month low.
We expect the labor force to rise by a modest 10k after a seven month high bounce of 60.5k in July. This will leave participation unchanged at the 65.1% seen in July, sustaining a bounce from three straight months at 65.0% ending in June. Before rounding this would see unemployment slipping to 6.37% from 6.41%, but after rounding would remain at 6.4%. We expect a 3.2% yr/yr increase in the average hourly wage of permanent employees, up from 3.0% in July but consistent with trend having lost some momentum.
