The unemployment rate increased by 0.3 percentage points in both Canada and Quebec in March, according to Statistics Canada, while it stood at 6.1% nationally and 5.0 % in Quebec in a context where more people are looking for work.
According to the federal agency, employment changed little in March in the country, with 2,200 jobs lost. The monthly increase in the unemployment rate was attributable to a 60,000 increase in the number of people looking for work or temporarily laid off.
In February, the unemployment rate was 5.8%, making the increase to 6.1% in March the largest monthly increase since the summer of 2022.
The rising unemployment rate comes as high interest rates weigh on the economy and strong population growth continues to add to the labor supply.
Job losses in March in Canada mainly occurred in the accommodation and food services (-27,000), wholesale and retail trade (-23,000) sectors, as well as professional and scientific services. and technical (-20,000).
In contrast, job gains were observed in four sectors, notably in health care and social assistance (+40,000).
Young people are particularly feeling the cold in the job market. Employment among those aged 15 to 24 fell by 28,000 in March and the unemployment rate increased to 12.6% for this age group. This is its highest level since September 2016 if we exclude the years 2020 and 2021, during the pandemic.
The total number of unemployed people stood at 1.3 million last month nationally, an increase of nearly 250,000 from last year.
Despite deteriorating labor market conditions, wages continued to grow rapidly, with the average hourly wage increasing 5.1% year over year.
In Quebec, after having varied little for five consecutive months, employment fell by 18,000 in March.
Nearly two-thirds of the drop in employment in Quebec was recorded among young people (-11,000), observed Statistics Canada.
In Montreal, the unemployment rate remained stable at 5.7%, while it increased from 2.9% in February to 3.1% last month in Quebec.
The jobs report is the last major economic data the Bank of Canada must take into account before its next interest rate decision, scheduled for next Wednesday.
Investors will be eagerly awaiting indications from the central bank on when it plans to start lowering its key interest rate, which currently stands at 5%.
Economists widely expect the Bank of Canada to make the first rate cut in June or July.