Key Takeways
- Public hiring drove half of September’s job growth, tempering optimism about private-sector recovery.
- Full-time focus: Candidates are gravitating toward stability — benefits, security, and long-term development.
- Retention priority: Beyond wages, employers must strengthen employee experience to prevent turnover.
- Private employers face a retention and competitiveness challenge, as government roles continue to attract experienced professionals.
- Reading time: 3 minutes
Labour Report Highlights
Statistics Canada released its monthly Labour Force Survey for September 2025, revealing steady employment growth amid continued economic uncertainty. The Canadian labour market added 60,000 jobs (+0.3%), driven largely by full-time positions, while the unemployment rate held firm at 7.1%. Although modest, these gains signal a resilient job market that continues to balance employer caution with worker confidence heading into the final quarter of the year.
- Employment up 60,000 (+0.3%), with the national unemployment rate steady at 7.1%.
- Full-time employment increased by 106,000, while part-time positions declined by 46,000.
- Job gains concentrated in manufacturing, health care and social assistance, and agriculture; retail trade saw a decline.
- Alberta led job creation (+1.7%), while Newfoundland and Labrador recorded the largest decrease (–0.9%).
- Average hourly wages rose 3.3% year-over-year to $36.78.
- Public sector employment rose by 31,000 (+0.7%), accounting for roughly half of all new jobs in September, while private sector employment grew only modestly.
- A growing skills mismatch emerged with more than 16% of workers reported jobs unrelated to their education, and one-third of recent immigrants said they were overqualified for their roles.
“Even as public hiring drives short-term growth, Canada’s long-term strength will come from private employers who invest in talent development and create environments where people can do their best work.” Craig Brown, CEO, Agilus Work Solutions
Public Sector Growth Skews Overall Stability
While headline numbers point to a stable labour market, the underlying composition tells a more complex story.
Nearly half of September’s employment gains came from the public sector — primarily public administration, health care, and education-related roles. Public sector employment rose by 31,000, compared to only 27,000 new jobs across the entire private sector and a 4,000 drop in self-employment.
This trend stands in contrast to the federal government’s stated intent to reduce the size of the public service, suggesting that recent gains may not be sustainable over the longer term. For private-sector employers, this creates a misleading sense of overall stability: job growth is being supported by government hiring rather than organic market expansion.
In other words, while the labour market appears steady on the surface, private-sector demand remains muted and cautious, particularly across retail, logistics, and construction.
What This Means for Employers in Canada
1. Stability is uneven — public hiring masks private hesitation
Private sector hiring remains slower than expected for the fall season, likely reflecting interest rate pressures and cautious investment outlooks. Employers should read “stability” as sector-specific: the strongest job gains came from government, education, and health care, not from the core private economy.
2. Full-time demand still rising
Despite subdued private growth, workers are prioritizing consistent hours, benefits, and predictability. Employers relying heavily on contract or part-time roles should explore converting key positions to full-time or enhancing part-time perks (e.g., guaranteed hours, flexible scheduling).
3. Wage growth and skills mismatch persist
The 3.3% annual increase in wages underscores the need for strong retention strategies. Simultaneously, overqualification among newcomers and postsecondary graduates points to underutilized talent. This is a significant opportunity for employers willing to invest in skill alignment and career mobility.
4. Skill shortages are deepening across growth sectors
With hiring surges in manufacturing, health care, and agriculture, specialized technical skills are increasingly in demand. Employers can get ahead by investing in workforce planning, upskilling, and developing apprenticeship or co-op partnerships.
How Agilus Can Help
For nearly 50 years, Agilus has served our candidate and employer networks, connecting job seekers with meaningful opportunities. As Canada’s largest privately owned full-service recruitment firm, Agilus connects businesses to specialized talent in engineering, technology, professional, and industrial roles across Canada.
Whether your organization is competing with public institutions for skilled talent or navigating regional hiring slowdowns, our team can help you find (and keep) the people who move your business forward. We are experts in specialized talent. Contact us to learn more.
FAQs
Q1: Why is full-time employment increasing while part-time work falls?
Workers are seeking stability in an uncertain economy. Employers should adapt by offering structured hours or guaranteed income models to attract reliable talent.
Q2: How can employers address rising skills mismatches?
Prioritize internal training, mentorship, and mobility programs. Re-skilling existing employees often costs less than recruiting externally.
Q3: Which provinces have the most active job markets?
Alberta continues to outperform, while Ontario and B.C. remain stable. Regional labour planning is key to optimizing recruitment efforts.
Q4: How should employers handle wage expectations?
Keep pace with market trends, but emphasize total rewards: professional growth, flexible work, recognition, and culture are increasingly valued.
Q5: What industries are expected to grow heading into Q4 2025?
Health care, advanced manufacturing, construction, and logistics all show continued expansion — areas where Agilus’ specialized recruiters can help you source the right talent.