- Sonny Scarfone
Principal Economist
Economic News
Quebec: The Labour Market Sends Contrasting Signals from Month to Month
June 5, 2026
Highlights
- In May, employment increased by 13,200 positions in Quebec, reducing the cumulative loss to 73,800 jobs since the beginning of the year (table).
- The unemployment rate fell by 0.6 percentage points to 5.6% (graph 1), the second lowest in Canada (6.6%), behind Manitoba (5.5%). This decline partly reflects a marked drop in the number of people actively seeking work, with the participation rate falling to 64.1%, its lowest level since the period of stringent pandemic-related restrictions.
- Full time employment rose sharply, up 51,800 positions, offsetting roughly half of the losses recorded earlier in 2026. The private sector also rebounded, with a gain of 25,300 jobs, recovering about half of the roughly 50,000 positions lost over the previous four months.
- Across sectors, cumulative losses since the start of the year have been concentrated in construction (-15,900), manufacturing (-16,100), wholesale and retail trade (-18,000), finance and insurance (-25,000), as well as educational services (-26,100). In contrast, professional, scientific and technical services (+19,100) recorded the most significant increase.
- Net job creation was concentrated in the Montréal census metropolitan area, with a gain of 35,300 positions. In about half of administrative regions, the unemployment rate declined year over year, although increases were observed in the Laurentides, as well as on the Côte-Nord and in Nord-du-Québec (graph 2).
Comments
The direction of the labour market remains difficult to pin down, with month-to-month fluctuations offering little clarity on whether conditions are improving or deteriorating. The unemployment rate remains comparable to the level observed at the same time last year (5.8%). Moreover, despite weakness in full-time employment, the share of part-time workers who would prefer full-time work (the R7 measure of labour underutilization) has not increased meaningfully.
After a brief return to positive territory driven by base effects from last year, hours worked have moved back into negative territory on a year-over-year basis, declining by 2.5%. Workers’ purchasing power is nonetheless holding up, with annual wage growth at 4.7%, outpacing inflation (3%), whose recent uptick reflects the crisis in the Middle East.
Implications
Beyond the month-to-month volatility, the distribution of job losses over the past five months, with only one sector posting a meaningful increase, points to fairly broad-based weakness in Quebec’s labour market. This is consistent with our outlook for provincial GDP, which is expected to record modest growth in 2026 External link., in the absence of clearly identifiable growth drivers.
Labour availability will also remain a constraint, including in segments less exposed to the trade war. The working-age population (15 to 64) continues to decline at a pace rarely seen, limiting the scope for a rebound (graph 3).
