Toronto’s unemployment rate surged to 8.1% in November, marking its highest level since January 2022, during the pandemic. This statistic, released by Statistics Canada, reveals that about 379,000 people in Toronto were looking for work last month. It places Toronto’s unemployment rate among the highest in Ontario, only behind Windsor, which has an 8.7% rate.
Unemployment Surge Tied to Interest Rates and Immigration
The rise in Toronto’s unemployment rate reflects trends seen across Canada, according to economist Jim Stanford. He explains that this was part of the Bank of Canada’s strategy when raising interest rates in 2022. The goal was to cool down the job market and reduce inflation. “What’s happening in Toronto is not unique,” Stanford told CTV News. While interest rates have contributed to slower job growth, immigration is also a factor, with more people arriving in Canada than the job market can absorb.
Impact of High Interest Rates
Graham Dobbs, Senior Economist at Toronto Metropolitan University, explained that high interest rates have led businesses to be more cautious in hiring. “Businesses are hiring less,” he noted, reflecting how the cost of borrowing has impacted business decisions. Although interest rates have started to decline, it will take time for businesses to adjust and ramp up hiring.
Immigration Plays a Role in Unemployment
Stanford also pointed out that the surge in immigration has contributed to the growing unemployment rate. A significant influx of new residents has added to the labor supply without a corresponding increase in available jobs. “The overall labor supply has been growing more than the number of jobs available,” he explained.
Youth Unemployment on the Rise
Youth unemployment has been particularly affected. According to Statistics Canada, nearly half of the unemployed individuals in November were either newcomers to the job market or hadn’t worked in the past year. This includes many recent graduates struggling to find full-time employment. The youth unemployment rate has jumped 2.3 percentage points year-over-year, the largest increase among age groups.
A Growing Job Market with Growing Unemployment
Despite the increase in unemployment, Canada’s economy added 51,000 jobs in November, mostly in full-time positions. This suggests that while the number of people seeking work is growing, employment opportunities are not keeping pace with population growth. “We’ve had the funny combination of growing employment and growing unemployment at the same time,” Stanford concluded.
References:
Toronto jobs: The city’s unemployment rate is now at its highest point since the COVID-19 pandemic
Canada Housing Market 
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