Canada's Unemployment Jumps Amid Trump Tariffs: Economy Faces Major Hit

The unemployment rate in Canada surged to 6.9% in April, reaching levels not seen outside the pandemic era since November, according to new data released on Friday. The uptick follows U.S. President Donald Trump's implementation of tariffs on Canadian exports, affecting nearly 1.6 million jobless citizens.

In April, the employment figures showed a modest gain of 7,400 positions, contrasting with a 32,600 job loss the previous month. While analysts expected a rise of 2,500 in employment, the unemployment rate was anticipated to reach 6.8%.

U.S. tariffs targeting Canadian steel, aluminum, and automobiles have strained businesses and households. The Bank of Canada predicts substantial economic repercussions, with falling exports and rising prices likely to impact growth and employment negatively in the upcoming months.

The number of unemployed or temporarily laid-off individuals increased by 39,000 in April, rising by 13.9% compared to the previous year. Statscan noted that 61% of March's unemployed remained jobless in April, marking a significant challenge for job seekers.

The manufacturing industry experienced significant decline, shedding 31,000 jobs due to tariffs and uncertainty. Despite sluggish overall employment growth, the public sector saw a boost of 23,000 positions, attributed to temporary hires for the federal election.

The employment rate fell to 60.8%, indicating a six-month low as population growth outpaced job creation. Average hourly wage growth for permanent employees stuck at 3.5%, reflecting inflationary concerns amid stagnant economic conditions.

(With inputs from agencies.)