Canada’s Jobless Rate Rises to 6.8% Despite December Hiring

        A employee sorts batteries on a conveyor belt at a recycling facility in Port Colborne, Ontario.

Canada’s unemployment rate climbed to 6.8% in December, even though the economy added 8,200 jobs during the month. The increase in unemployment wasn’t driven by widespread layoffs but by a surge in the number of people entering the labour force and actively looking for work.

December Highlights

• Unemployment rate: Up from 6.5% to 6.8%
• Employment: Net gain of 8,200 jobs
• Labour force: Expanded significantly, outpacing job creation
• Full-time work: Increased
• Part-time work: Declined

Why the Rate Rose

Economists point out that the rise in unemployment reflects renewed labour market participation, not a weakening economy. More Canadians felt confident enough to start job hunting, but hiring didn’t keep pace with the influx of job seekers.

This marks the fourth straight month of employment growth, yet December also saw the largest increase in unemployed individuals in several years — a sign of a labour market adjusting to shifting economic conditions.

Sector Trends

• Gains: Healthcare, social assistance, and construction
• Declines: Professional services, accommodation and food services, and utilities

Looking Ahead

With more people entering the job market and competition for roles increasing, analysts expect early 2026 to bring a tighter, more competitive labour environment. The December data suggests a labour market that is expanding but still finding its balance.