Don’t let the high unemployment rate fool you; Canada is still experiencing a labour shortage, and economists say employees will only gain more leverage in the market as the economy continues to recover into 2025.The rising unemployment rate, however, may be deceiving, as talent surpluses are largely confined to specific corners of the economy. For most other sectors, hiring remains a challenge.
Mr. Janzen says weaknesses in the labour market are largely confined to new entrants – typically younger and new Canadians – owing to significant slowdowns in consumer spending. He explains that high interest rates have slowed spending on retail, hospitality and food services, which tend to hire disproportionately from those talent pools.
“We’re probably closer to the end than the beginning of this labour market slowdown,” he says. “We expect the unemployment rate to stop rising next year, and then drift lower later next year and into 2026.” According to the study, 80 per cent of Canadians are finding meaning in their work, but one in three intend to look for a new job in the new year, including 52 per cent of those aged 18 to 27. At the same time, Ms. Minatel doesn’t believe Canada will see another wave of the “Great Resignation” in 2025, even as the labour market moves further in favour of employees.