- Sonny Scarfone
Principal Economist
Economic News
Quebec: Labour Market Recovery in Greater Montreal, Constraints Elsewhere in the Province
April 10, 2026
Highlights
- In March, employment in Quebec increased by 9,900 jobs, marking a modest rebound after the loss of 57,300 jobs the previous month (table).
- Combined with a decline in the participation rate, this development brought the unemployment rate down to 5.4% (graph 1). This is the second lowest rate in Canada (6.7%), behind Saskatchewan (5.0%).
- Underlying details nevertheless point to a mixed performance. Full-time employment declined again, bringing cumulative losses to more than 50,000 jobs since the start of 2026. By contrast, private-sector employment returned to growth, recouping more than half of the losses recorded earlier this year.
- Among the net 43,700 jobs lost so far in 2026, the finance, insurance and real estate sector (‑18,000), education (‑20,000), construction (‑14,400) and manufacturing (‑8,400) posted the largest declines. By contrast, only one sector recorded notable growth, namely professional, scientific and technical services (+18,600).
- Job creation in March was particularly strong in the Montreal metropolitan area, with a gain of 23,800 positions. On a year-over-year basis, non-seasonally adjusted unemployment rates declined in 11 of Quebec’s administrative regions (graph 2). Of note, the Quebec City CMA posted the lowest unemployment rate among Canada’s 20 largest metropolitan areas, at 2.6%.
Comments
After last month’s sharp bout of concern, the data released this morning provide some relief. While far from unequivocally positive, they remain indicative of an economy facing cyclical pressures, but also constrained by the persistent weakness of its labour supply.
For a fifth consecutive month, the population aged 15 and over as estimated by the Labour Force Survey declined. Although it is still up 0.5% year over year, this increase is entirely attributable to growth in the population aged 65 and older (+0.8%), while the 15‑to‑64 age group, typically considered the core working-age population, has declined by 0.3% (graph 3).
Other indicators suggest that the softness in employment gains reflects supply-side constraints rather than a broad-based weakening in demand, at least outside sectors exposed to the ongoing trade dispute. For instance, the seasonally adjusted unemployment rate calculated using a methodology comparable to that used in the United States stands at 4.4%, a level very close to that observed south of the border (4.3%), where labour force growth has also been constrained amid current immigration policies.
Finally, although recent developments in full-time employment could give the impression of a labour market under strain, the share of involuntary part-time workers and discouraged job seekers remains relatively low, at 0.9%. This proportion is comparable to levels observed prior to developments on the international stage over the past 15 months.
Wage growth should also not be overlooked, having accelerated to 6.4% year over year, its fastest pace in three years (although composition effects may be exerting some upward influence on average wages). This increase will provide a degree of cushioning for workers in an environment where inflation is expected to remain elevated as a result of the conflict in the Middle East, keeping inflation above its 2% target. It also points to a labour market that continues to grant workers significant bargaining power.
Implications
While not particularly strong, this report displays characteristics consistent with an economy that continues to grow, albeit still operating below its full potential. In this regard, last month’s results appeared to be an outlier, as they aligned poorly with administrative data, including provincial government tax revenues and reported layoffs. Over the longer term, potential real GDP growth is expected to remain constrained by demographic dynamics, particularly outside of urban centres.