Canadians Face Fewer Layoffs Than Normal, But Good Luck Finding A Job

Key Takeaways

• Employment rose 0.1% in March, adding 14.1k jobs
• Layoff rate held at 0.6%, near pre‑pandemic levels
• Job‑finding rate fell to 15.2%, indicating hiring weakness
• Average hourly wages jumped 4.7% YoY, driven by full‑time workers

Pulse Analysis

Canada’s labour market in March 2026 delivered a mixed picture that defies the headline‑grabbing fears of AI‑driven or trade‑war‑induced layoffs. Seasonally adjusted employment ticked up by 0.1%, halting a 0.5% decline earlier in the year and bringing total jobs to just over 21 million. The unemployment rate remained unchanged at 6.7%, and the layoff rate of 0.6% mirrors the pre‑COVID average, suggesting that the anticipated wave of job cuts has not materialised. This stability, however, masks a deeper issue: a pronounced slowdown in hiring, as evidenced by the job‑finding rate slipping to 15.2%—well below the 19.1% pre‑pandemic benchmark.

The hiring shortfall reflects broader business‑confidence concerns. Companies appear to be postponing new hires amid uncertainty surrounding the Bank of Canada’s warning that the “old economy” is dead and ongoing geopolitical tensions. The reduced job‑finding rate translates to roughly 21 k fewer layoffs than expected, but it also means that a larger share of the labour force remains idle, potentially suppressing consumer demand. Policymakers must balance the need to stimulate hiring without igniting wage‑driven inflation, especially as the labour market shows signs of structural shifts.

Wage dynamics add another layer of complexity. Average hourly earnings rose 4.7% year‑over‑year, the strongest growth since late 2024, yet when adjusted for occupation and tenure the increase falls to 3.6%, indicating that the headline surge is driven by a composition effect. Full‑time positions and senior workers (55+) are seeing the biggest gains, while younger, part‑time workers lag behind. This divergence could exacerbate income inequality and influence future labour‑policy debates, as the government seeks to encourage inclusive hiring while containing inflationary pressures.