- Sonny Scarfone
Principal Economist
Economic News
Quebec: Signs of Labour Market Steadiness in August
September 5, 2025
Highlights
- Quebec’s labour market recorded a net gain of 7,500 jobs in August, partially recovering from the 15,000 positions lost in July. This performance stands in contrast to the rest of Canada, where employment fell by 73,000 jobs. Year-to-date, Quebec has added a net total of 24,600 jobs in 2025.
- However, the unemployment rate rose, driven by growth in the labour force. It increased from 5.5% in July to 6.0% in August.
- Employment growth came entirely from part-time positions (+21,900), while full-time employment declined by 14,400. So far in 2025, full-time jobs have posted a cumulative loss of 28,400.
- At the sectoral level, few significant changes were observed, pointing to a degree of stability across the broader economy. The strongest performance came from the manufacturing sector, which returned to growth (+7,800), reducing the year-to-date loss to 2,400 jobs—a notable sign of resilience amid the ongoing tariff war. In contrast, professional services posted the weakest result, with a loss of 7,700 jobs.
- At the regional level, the unemployment rate exceeded the provincial average in Montréal (9.4%), in Outaouais (7.1%), and in Laval (6.7%). Among Canada’s major metropolitan areas, Montréal is approaching Toronto (9.5%), which continues to hold the highest unemployment rate.
Comments
Like a pendulum, monthly job losses in 2025 are often partially offset the following month. Despite the positive figure reported this month, the underlying details remain concerning, as full-time positions continue to be scarce. Total hours worked were down 0.5% compared to the same month last year.
August data point to an economy that is treading water, with layoffs remaining contained but hiring even more so. This trend continues to be reflected in youth labour market statistics, as the unemployment rate for those aged 15 to 24 remains elevated at 11.3%, compared with 5.0% for the 25 to 54 age group, which has held relatively steady since the beginning of the year. We discussed the underlying causes of this situation in an Economic Viewpoint External link. published earlier this week on Canada’s labour market. The long-term consequences External link. of a weak job market for young workers highlight the importance of closely monitoring this trend.
Despite current conditions, wage growth remained strong, reaching 3.7% year-over-year. This pace compares to an inflation rate recently estimated at 2.3% in the previous month, suggesting that the purchasing power of Quebec workers continues to improve.
Implications
The labour market continues to show resilience under the current circumstances, but no one is immune to the impacts of the tariff war. This is confirmed by the data released this morning for both Canada and the United States. With inflation hovering near the Bank of Canada’s target, we maintain our view that monetary policy should become more accommodative in the coming months. The central bank could lower its key interest rate as early as September.