Actalent Canada Labour Market Brief: A Look at Trends in Q1 2025

Actalent's quarterly Labour Market and Economy Report connects important dots between data and trends across Canada’s engineering and sciences hiring landscape. Readers can expect to learn about job growth, wage growth, inflation, unemployment rates, labour force participation rates and other key factors that impact the attraction, hiring and retention of workers.

Executive Summary

Canada’s economy added 44,500 jobs in Q1 2025, falling below the 138,100 jobs added in Q4 2024 (revised down from the 155,900 jobs reported in Actalent’s previous report). The labour market slowed considerably throughout the first quarter due to increasing financial, economic and political uncertainty. Employment rose by 76,000 in January, increased by just 1,100 in February and then fell by 32,600 in March.

The unemployment rate slightly decreased from an average of 6.7% in Q4 2024 to 6.6% in Q1 2025.

Among the industries Actalent supports, Q1 2025 unemployment rates were as follows: healthcare (1.7%), utilities (1.4%), professional, scientific and technical services (4.1%), manufacturing (3.6%), and construction (5.8%).

Year-over-year inflation remained close to the Bank of Canada’s (BoC) 2.0% target in Q1, ending at 2.3% in March. The BoC lowered its key interest rate by 25 basis points in both January and March. The BoC emphasized that it would continue to closely monitor inflation expectations due to the "more-than-usual" uncertainty caused by the rapidly evolving trade policy landscape.

The year-over-year average hourly wage rate for all employees increased by 3.6% from Q1 2024 to Q1 2025, 0.7% below the annual wage growth observed in Q4. In terms of “real” earnings (adjusted for inflation), wages continue to outpace inflation.