Canada’s labour market exhibited a mixed performance in July 2024, with a modest increase in payroll employment counterbalanced by a significant decline in job vacancies, according to the latest report of Statistics Canada.
In July 2024, the number of employees receiving pay and benefits from their employer, as measured by payroll employment, rose by 32,800 positions, a 0.2% increase. This marks a recovery from the decline of 22,900 jobs in June and follows a five-month streak of increases earlier this year. On a year-over-year basis, payroll employment experienced a modest gain of 157,700 jobs, reflecting a 0.9% growth.
The July increase in payroll employment was driven by gains in five out of twenty major sectors, with health care and social assistance leading the way, adding 17,600 jobs—a 0.7% rise. The sector’s growth more than compensated for the job losses it experienced in June, continuing a broader trend of employment growth since September 2022. Over the past 22 months, the sector has added 176,600 positions, a cumulative increase of 8.0%, highlighting the ongoing demand for workers in essential services. Notably, general medical and surgical hospitals, child day-care services, and nursing care facilities have been the primary contributors to this sustained growth, accounting for over half of the sector’s job gains since September 2022.
Public administration also recorded a solid increase in July, adding 8,000 jobs, a 0.6% rise, with local, municipal, and regional administration accounting for the majority of this growth.
The retail trade sector saw a more modest increase of 2,300 jobs (0.1%), reversing some of the losses from the previous month. However, this sector has struggled overall, with payroll employment down by 1.6% since peaking in February 2023.
Conversely, five sectors experienced declines in payroll employment in July, with manufacturing and construction being the hardest hit. Manufacturing shed 6,200 jobs (0.4%), marking the second consecutive month of decline, driven primarily by losses in food manufacturing and plastics and rubber products manufacturing. The construction sector also saw a decrease of 2,400 jobs (0.2%), with losses concentrated in heavy and civil engineering and non-residential construction.
While payroll employment showed some resilience, job vacancies continued their downward trajectory in July, falling by 22,400 positions (-4.1%) to 526,900. This marks the third consecutive month of decline in job vacancies and a dramatic 47.5% drop from the peak of 1,003,400 vacancies in May 2022. The job vacancy rate edged down to 3.0% in July, from 3.1% in June and 4.0% a year earlier.
The ongoing decline in job vacancies was observed across multiple sectors, with transportation and warehousing, accommodation and food services, and manufacturing experiencing the most significant reductions. Job vacancies in transportation and warehousing plummeted by 24.3% (-8,100), while accommodation and food services saw an 11.3% decrease (-6,500). Manufacturing job vacancies fell by 15.7% (-5,800), continuing a steady decline that has brought vacancies in the sector to their lowest level since November 2016.
Despite the overall decrease, the health care and social assistance sector continued to post the highest job vacancy rate among all sectors at 5.1%. However, even this sector saw a year-over-year decline in vacancies, though at a slower pace compared to other industries.
Regionally, job vacancies fell in four provinces: Ontario, Manitoba, Newfoundland and Labrador, and Nova Scotia. Ontario, Canada’s most populous province, recorded the largest decline, with vacancies dropping by 11,900 positions to 183,200. British Columbia, which held the highest job vacancy rate at 3.6%, saw its rate decline from 4.6% in July 2023. Meanwhile, Newfoundland and Labrador reported the lowest job vacancy rate at 1.9%.
Amid these employment shifts, average weekly earnings for Canadian workers continued to rise, reaching $1,267.54 in July, a 1.0% increase from the previous month and a 4.5% increase compared to July 2023. This increase in earnings reflects a combination of factors, including wage growth, changes in employment composition, and variations in hours worked. The average number of weekly hours worked remained relatively stable in July, with a slight year-over-year increase of 0.6% to 33.5 hours.
The decline in job vacancies and the modest growth in payroll employment occur against the backdrop of a Canadian economy grappling with inflationary pressures and uncertainty in global markets. The unemployment-to-job vacancy ratio, which measures the number of unemployed persons per job vacancy, increased for the fifth consecutive month to 2.7 in July, up from 2.6 in June. This trend suggests that despite the availability of jobs, matching workers with vacancies remains a challenge in certain sectors, particularly as some industries continue to downsize.
As Canada moves further into the second half of 2024, the labour market’s trajectory remains uncertain, with sectoral imbalances and regional disparities continuing to shape the employment landscape. The ongoing decline in job vacancies may signal a cooling labour market, even as wages and payroll employment show resilience.