Canada’s Job Market Is Booming
Canada’s employment numbers for September suggest a robust rebound — but critics say the numbers may be misleading once you dig into the unadjusted data. Seasonally adjusted figures report tens of thousands of jobs added, including a six-figure gain in full-time roles. However, raw or unadjusted employment data paints a different picture: a modest decline. This divergence has reignited debate over how much to trust adjusted statistical models.
Strength in Manufacturing, Healthcare, and Agriculture?
In the adjusted stats, manufacturing led job growth with 28,000 new positions, followed by gains in healthcare (14,000) and agriculture (13,000). The upward adjustments suggest an unusually strong month compared to past years. But skeptics argue that these sectoral surges in volatile industries make the adjusted numbers look artificially inflated, especially given the inherent variability in manufacturing and agricultural jobs.
Seasonal Adjustment: Friend or Foe?
Seasonal adjustments are intended to iron out predictable fluctuations — such as summer job losses or holiday hiring — in order to reveal underlying trends. Critics contend that Statistics Canada’s model may have overcorrected, effectively magnifying modest raw gains into headline-grabbing numbers. In this view, the adjusted numbers may misrepresent actual labor market performance.
Full-Time Job Gains Clash with Raw Data Losses
One of the most eye-catching claims is the addition of over 100,000 full-time jobs in one month. But the unadjusted figures tell a different story: a decline of more than 360,000. In other words, the very category portrayed as booming may be an artifact of seasonal smoothing rather than a concrete improvement in conditions. To doubters, that suggests the reported growth may be more statistical smoke and mirrors than real economic momentum.
Uncertainty Looms Over Policy and Interpretation
While no one suggests malice in the adjustments, the sharp contrast between adjusted and unadjusted data raises serious questions about interpreting Canada’s labor market. If the adjustment models are overstating strength, they may spill over into analyses of GDP, inflation, and policy decisions. Observers will be watching subsequent months' raw and adjusted numbers closely to see whether the “boom” holds up — or if it was an illusion all along.
Read Next
Canadian Homebuilding and Market Outlook: Growth Meets Caution
<p>Despite signs of weakness in resale activity, Canada’s housing starts rose sharply in September, with builders pushing ahead on projects that had been planned months or years earlier. The increase in new home construction might seem to contradict the broader slowdown, but it likely reflects government incentives, backlog clearances, and the long lead time between approvals and ground-breaking. Builders are still cautious, though, as rising material costs, labour shortages, and slower presales are putting pressure on margins.</p><p></p><p>While construction levels are up in the short term, overall sentiment among developers has softened. Many builders are concerned that rising interest rates and limited buyer demand could lead to oversupply in certain markets, especially urban condo sectors. Others worry that the affordability crisis and tightening credit could slow future absorption rates. This mix of growth and hesitation captures the current mood of the housing industry — active but uncertain, forward-looking but wary of headwinds.</p><p></p><p>For the broader economy, this dynamic represents both a risk and an opportunity. If demand continues to lag behind supply, prices could fall further before stabilizing. However, the increased pace of construction could help alleviate Canada’s chronic housing shortage once conditions normalize. The next few quarters will be pivotal: if interest rates ease and consumer confidence strengthens, today’s cautious building activity could position the market for a healthier recovery in 2026.</p><p></p><p>Additional Insight: The tension between housing supply goals and financial reality is now at the forefront of national policy debates. Governments are pushing for record levels of construction to address the housing crisis, but private developers are signaling that the math no longer works without lower borrowing costs or subsidies. This disconnect may lead to policy innovation — including new financing models, public-private partnerships, or targeted tax incentives — aimed at keeping construction alive while protecting affordability.</p>
GTA Home Sales Climb in September as Rate Cut Boosts Demand
<p></p><p>Home sales in the Greater Toronto Area rose sharply in September 2025, with 5,592 units sold — an 8.5% increase compared to the same month last year and a modest gain from August. The rebound is largely attributed to the Bank of Canada’s recent interest rate cut, which helped revive buyer confidence and improve affordability. After months of hesitation, many prospective buyers re-entered the market, encouraged by slightly lower borrowing costs and more stable economic indicators.</p><p></p><p>Prices Still Soft, but Signs of Stabilization Emerge</p><p></p><p>Despite stronger sales, home prices across the region remain below last year’s levels. The composite benchmark price declined by about 5.5% year-over-year to roughly $960,000, while the average selling price fell around 4.7% to just over $1.05 million. However, there are early signs of stabilization as prices in some segments ticked up slightly month-over-month. This suggests the market may be approaching a turning point after an extended period of decline.</p><p></p><p>New Home Market Plunges to Historic Lows</p><p></p><p>The new home sector, in contrast, continues to struggle. Only around 300 new homes were sold in August — a 42% drop from a year earlier and more than 80% below the 10-year average for that month. Developers have been holding back on new launches amid weak presales and rising construction costs. Meanwhile, a surge of completions from earlier projects is adding to supply, further complicating market conditions for builders.</p><p></p><p>Buyers Hold the Edge, but Window May Be Closing</p><p></p><p>With active listings nearing 30,000 across the GTA and a sales-to-new-listings ratio around 29%, the market still favors buyers. There’s ample inventory and room for negotiation, especially in the condo segment. However, the recent improvement in sales activity and easing interest rates could gradually reduce this advantage. Analysts warn that if demand continues to strengthen, buyers’ current leverage may start to shrink.</p><p></p><p>Outlook: Modest Rebound, But Structural Headwinds Ahead</p><p></p><p>Looking forward, experts expect the GTA housing market to experience a slow but steady recovery through 2026, supported by lower interest rates and renewed consumer confidence. However, the sharp decline in new construction raises concerns about long-term supply shortages. If developers continue to delay projects, future inventory could tighten significantly, potentially leading to another cycle of price escalation in the years ahead.</p>