The latest Labour Force Survey from Statistics Canada, released on Friday (July 11), shows a surprising drop in B.C.'s unemployment rate despite U.S. President Donald Trump's trade war with Canada entering its sixth month.
B.C.'s unemployment rate for June is down 0.8 percentage points compared to May, settling at 5.6 per cent. The employment rate increased 0.1 percentage points to 61.4 per cent. The difference is likely due to demographic shifts in the job market, such as people retiring and leaving the workforce.
Canada's national unemployment rate decreased 0.1 percentage points to 6.9 per cent.
Both Canada and the U.S. are still not seeing the expected impact of the trade war on labour markets, with the unemployment rate in both countries edging down 0.1 percentage points in June.
Canada's unemployment rate was 0.3 percentage points higher than last June, while in the U.S., the rate was the same. This has widened the gap between the countries, though neither has experienced large-scale job losses.
Diana Gibson, B.C. Jobs, Economic Development and Innovation minister, said the positive labour numbers are a testament to the resilience of the province's economy. But, despite this strong labour market, she said the tariffs and the threat of tariffs are slowing economic growth.
"When I first got into this position in November, in the fall, we were really poised for growth," she told Efteen. "Interest rates were coming down, inflation was coming down, and there was a really excited feeling in the business sector. And then tariffs hit, and that's put a real damper on that."
One less rosy statistic that still stands out for both B.C. and Canada as a whole is the unemployment rate for young people aged 15 to 24. While core aged adults aged 25 to 54 made gains this month, the unemployment rate for youth remained stubbornly high.
Still, the unemployment rate for that age group decreased 3.6 percentage points from last month's high of 16.6 per cent.
"But, of course, 13 per cent is still too high," Gibson said. "We want to see those youth getting that first job or that summer job."
With the looming prospect of more tariffs — Trump is now threatening 35 per cent on Canadian goods starting Aug.1 — Gibson expects to see added impacts on the B.C. economy and job market. Even if he doesn't follow through, just the prospect of new tariffs can hamper investment.
"As a former business owner myself, I know uncertainty isn't the friend of business," she said.
Removing interprovincial trade barriers still a work in progress
The B.C. government plans to continue to work toward diversifying its trading partners and removing interprovincial trade barriers.
Gibson had spent the week in Quebec City with representatives from other provinces hashing out how some of that would work.
Prime Minister Mark Carney said in April he wants free trade within Canada by July 1, a day that has come and gone.
But Gibson said there was progress in removing some of the exceptions to the Canada Free Trade Agreement held by individual provinces. She said B.C. has dropped two out of its 15.
These exceptions allow individual provinces and territories to protect industries important to them. Some of B.C.'s may be kept with this goal in mind, Gibson said.
