Canada’s payroll employment rose modestly in January 2025, driven by gains in education, retail, and health care sectors, while job vacancies remained largely unchanged but significantly lower compared to a year ago.
Statistics Canada reported that payroll employment increased by 26,800 positions (+0.1%) in January, following a stronger gain of 66,400 (+0.4%) in December. Year-over-year, payroll employment grew by 198,900 jobs (+1.1%).
“Payroll employment” is defined by the agency as “the number of employees receiving pay and benefits from their employer.
Educational services led the monthly increase with 26,200 new payroll positions (+1.8%), rebounding from a December dip. Retail trade added 9,800 jobs (+0.5%), and health care and social assistance rose by 7,300 positions (+0.3%).
Meanwhile, job vacancies held steady at 526,200 in January but were down 136,700 (-20.6%) from January 2024, reflecting a cooling labour market.
Education rebounds after December dip
The educational services sector saw the largest gain in January, led by hiring in elementary and secondary schools (+12,300; +1.4%), universities (+8,000; +2.4%) and community colleges and CEGEPs (+4,300; +3.1%).
These three groups accounted for more than 90 per cent of payroll employment in the education sector, which posted a year-over-year increase of 69,500 jobs (+4.8%).
However, job vacancies in educational services fell by 2,800 (-14.8%) to 16,300 in January—the lowest level since April 2021. Vacancies in the sector are down 26.8 per cent year-over-year, with a job vacancy rate of just 1.1 per cent.
Retail trade makes up ground but still lags year-over-year
Retail trade payroll employment increased by 9,800 in January, reversing declines in November and December. Despite the rebound, employment in the sector was still down 18,500 jobs (-0.9%) compared to a year ago.
The losses were concentrated among sporting goods, hobby and book stores (-11,400; -5.4%), electronics and furniture retailers (-5,900; -5.5%), and general merchandise stores (-3,000; -1.1%).
These declines were partially offset by hiring gains in health and personal care retailers (+3,100; +1.4%), motor vehicle and parts dealers (+2,800; +1.3%), and clothing and accessories stores (+2,300; +1.1%).
Retail job vacancies were also down sharply year-over-year, falling 25 per cent (-16,800), as employers in the sector navigated slower consumer demand and cost pressures.
Health care hiring continues amid persistent labour shortages
The health care and social assistance sector added 7,300 payroll jobs in January, on top of 8,100 gained in December. Over the year, the sector grew by 87,900 positions (+3.8%).
Hospitals saw the largest gains (+32,500; +5.2%), followed by child day-care services (+9,800; +5.3%) and nursing care facilities (+8,500; +3.6%).
Despite the growth, job vacancies in the sector remained elevated at 109,200—accounting for more than one in five job openings across all sectors. The job vacancy rate in health care stood at 4.3 per cent in January, down 1.5 percentage points from a year earlier.
Construction sees job losses after late 2024 gains
Construction payrolls fell by 8,000 positions (-0.7%) in January, offsetting some of the cumulative growth seen from September to December. On an annual basis, construction employment remained up by 11,900 jobs (+1.0%).
Specialty trade contractors led the year-over-year gains (+9,100; +1.3%), with smaller increases in non-residential (+1,800; +1.5%) and residential building construction (+1,300; +0.8%).
Average weekly earnings climb 5.5% year-over-year
Average weekly earnings rose 5.5 per cent to $1,294 in January compared to the previous year. The pace of growth moderated slightly from December’s 5.9 per cent.
Earnings growth reflects a mix of factors including wage changes, hours worked, and shifts in employment composition. Weekly hours averaged 33.5, little changed from both the prior month and year.
Job vacancies remain flat, but slack is growing
There were 2.8 unemployed persons for every job vacancy in January, unchanged from December but up from 1.9 a year earlier. The shift reflects a decline in vacancies combined with a rise in the number of unemployed Canadians (+250,500; +20.2%).
The national job vacancy rate stood at 2.9 per cent in January, down 0.1 percentage points from December and 0.8 percentage points year-over-year.
Alberta recorded the largest provincial drop in vacancies, down 8,600 positions (-11.9%). On a national scale, job vacancies declined in 15 out of 20 sectors, with the largest annual drops in health care (-35,000), retail trade (-16,800), and accommodation and food services (-13,000).
Accommodation and food services continued to report the highest vacancy rate at 5.0 per cent in January, though still down from early 2024.
