Construction workers rig materials for a lift in Toronto. The number of employees receiving pay and benefits fell by 6,200 in April, after a drop of 20,900 in March, a Statistics Canada report says.Nathan Denette/The Canadian Press
The Canadian economy shed jobs in the early weeks of the U.S.-Canada trade war and vacancies continued to drop this spring, showing that employers are scaling back their hiring plans at a fraught time for the economy.
The number of employees receiving pay and benefits fell by 6,200 in April, after a drop of 20,900 in March, Statistics Canada said Thursday in a report. The number of job vacancies, meanwhile, has ebbed to just over 500,000 – down from a peak of nearly one million in 2022.
The U.S.-driven trade war has sent a chill through the Canadian labour market, which struggled in 2023 and 2024 as companies grappled with higher interest rates. Now, with the Canadian economy slammed by U.S. tariffs, businesses are reticent to add to their payrolls or have resorted to layoffs.
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Job opportunities have been drying up for much of the past three years. The job vacancy rate, which measures the number of vacant positions as a proportion of total labour demand, has slipped to 2.8 per cent as of April, down from a peak of 5.7 per cent in March, 2022.
Statscan’s payroll employment report uses data from the Canada Revenue Agency, various levels of government and a survey of about 15,000 businesses to produce its estimates. Some economists consider it a more reliable gauge of employment trends than Statscan’s monthly and more timely Labour Force Survey, which showed the unemployment rate rose to 7 per cent in May.
Nationwide, the number of job vacancies fell by nearly 17,000 month over month. The finance and insurance industry experienced the largest drop, down 4,000 postings from March. Wholesale trade was not far behind, down about 2,700 vacancies.
Payroll employment fell by 7,300 in April in the manufacturing industry, which has been targeted by the Trump administration’s tariffs on autos, steel and aluminum.
Most major sectors have seen employment decline in the past four months, National Bank of Canada said in a client note on Thursday.
“This development contrasts with the Bank of Canada’s message last week, which highlighted resilient job creation outside of U.S. export-sensitive sectors so far in 2025,” deputy chief economist Matthieu Arseneau wrote.
Last week, the Bank of Canada noted how tariffs are affecting trade-intensive industries, but other industries have, so far, held up in employment – with the caveat that if tariffs and economic uncertainty persist, and domestic demand in Canada remains soft, businesses will cut jobs.
In a note to clients, CIBC Capital Markets senior economist Andrew Grantham said that it wasn’t just trade-sensitive sectors that lost jobs in April, pointing to a decline in the accommodation and food services industry.
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“Overall, the weaker trend within this survey suggests that the labour market is softer than the [Labour Force Survey] report does, and supports our forecast for two more 25 [basis point] cuts from the Bank of Canada before the end of the year,” Mr. Grantham wrote.
Canada’s westernmost and easternmost provinces felt the worst of the job vacancy squeeze. There were 7,300 fewer job postings in British Columbia in April, a decline of 8.5 per cent from the previous month.
In Atlantic Canada, the decline in the number of job vacancies was smaller in raw terms, but in percentage terms, Newfoundland and Labrador saw postings tumble by 26.3 per cent, and New Brunswick by 16.8 per cent.
Alongside the lack of job opportunities, unemployment has also been rising, according to the report. There were 3.1 unemployed workers for every job vacancy nationwide in April, up from 2.9 in March.