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The unemployment rate in Canada rose 0.2 percentage points to 7.1% in August 2025, the highest level in four years, above market expectations of 7% and higher than the 6.9% recorded in July. This was in line with the Bank of Canada's assessment that a large supply of labor and increasing growth concerns due to tariffs and uncertain economic policy from the US threatened further deterioration in the domestic labor backdrop. The number of unemployed people increased to about 1.595 million. This coincided with a 66,000 drop in net employment, extending the 41,000 decrease in July, as the participation rate fell by 0.1 percentage points to 65.1%. In turn, youth unemployment remained elevated at 14.5%, largely due to slow hiring for seasonal summer jobs.