This pattern ‘remains consistent with per-worker market conditions broadly improving’
Canada's labour market is expected to add 5,000 jobs in July while the unemployment rate holds at 6.5%, according to a new RBC Economics forecast.
The projected 6.5% unemployment rate would be down from 6.9% in April and 0.4 percentage points lower than a year earlier, even as overall employment remains slightly down for the year, noted report authors RBC Assistant Chief Economist Nathan Janzen and RBC economist Abbey Xu.
Janzen and Xu wrote that this pattern "remains consistent with per-worker market conditions broadly improving," pointing to slower population and labour force growth as a contributing factor.
RBC also noted that job postings "have changed little heading into July, suggesting hiring demand has continued to stabilize despite ongoing trade uncertainty." For HR teams, that plateau suggests hiring plans are unlikely to shift sharply in either direction heading into fall workforce planning.
HR professionals should take note of Canada's second straight month of economic growth, as broad-based gains across may be signalling tightening labour markets and rising hiring competition, recent Statistics Canada numbers (StatCan) showed.
Wage growth and employment composition
According to the RBC report, June's employment increase was driven mainly by part-time positions, with full-time roles posting a more modest gain — a mix that carries implications for benefits eligibility and staffing models depending on an organization's workforce composition.
Average hourly wage growth picked up slightly in June after slowing sharply in May, RBC said, but the economists cautioned that growth is likely to keep drifting lower given that labour market slack remains high by historical standards. That trend is one HR professionals may want to factor into 2027 compensation budget planning.
RBC pointed to a separate data source, Statistics Canada's Survey of Employment, Payrolls and Hours, as showing a firmer picture than the more frequently cited Labour Force Survey. That survey showed employment up 95,000 this year through May, with hours worked tracking firm, RBC said, underscoring that different data sources can paint varying pictures of labour market strength.
Janzen and Xu concluded that a July report in line with their forecast would reinforce RBC's base case that Canada's economy remains on a path of "modest, but steady expansion." The economists also forecast Canadian exports will decrease by 1.2% in June, driven largely by lower oil prices, while imports rise 0.3% on stronger motor vehicle shipments, narrowing the merchandise trade surplus to $3.1 billion from $4.2 billion in May.
The risk of noncompliance is holding organisations back from hiring globally, despite strong enthusiasm from executives to expand, according to a previous report.
