Canada’s latest employment data points to a labour market that appears stable on the surface but is undergoing deeper structural shifts, according to Suzanne Sears, CEO of Best Retail Careers International Inc. and Luxury Careers International. In an interview with Retail Insider, Sears said recent numbers reflect not simply economic cycles but changing social values, career expectations, and migration patterns that are reshaping the Canadian retail labour market.
January’s national jobs report showed employment declining by about 25,000 positions, while the unemployment rate fell to 6.5 per cent from 6.8 per cent in December. That drop was largely driven by fewer people actively searching for work rather than a surge in hiring. At the same time, retail employment remained essentially flat, with only a small uptick of about 0.1 per cent in the broad wholesale and retail trade category.
Sears said those headline figures mask significant underlying trends. “We did lose 25,000 jobs in total, but the unemployment rate went down. How does that happen? It happens because a significant number of people simply left the workforce,” she said.
Aging Workforce and Youth Returning to School
One of the most notable forces shaping the Canadian retail labour market is demographic change. Sears said a growing number of older workers are exiting the workforce altogether.
“A big chunk of that is the seniors aging out saying, ‘I’m done with this,’” she said.
At the other end of the demographic spectrum, Sears pointed to youth employment trends that are diverging from expectations. While there had been widespread concern about a lack of part-time jobs for young workers, she said the situation changed rapidly in recent months.
“In the fall, megatons of part-time jobs were created and youth took them. They ditched them in unprecedented numbers. Where did they go? They all went back to school or training,” she said.
According to Sears, that trend reflects a broader generational shift in attitudes toward work and career paths. “You can see a society saying, ‘I’m not going to work at Ford like my dad did.’ The sector that I’m working in doesn’t pay, so I’m going back to school.”
She added that the number of young people returning to advanced education has been “really quite shocking,” suggesting a long-term change in labour supply across several industries.
Manufacturing Declines and Service Sector Growth
The January data showed notable declines in manufacturing employment, down about 2.3 per cent, while sectors such as recreation, restaurants, and cultural services posted gains. Sears said those shifts reflect both economic pressures and changing consumer priorities.
“You see manufacturing losing jobs, but mostly that manufacturing that’s losing jobs are the ones that are in trade and tariff sectors,” she said. “People are not waiting around for manufacturing to crash altogether. They’re actively shifting away.”
At the same time, she pointed to strong employment growth in experience-based sectors. “You can see the recreation industry, restaurant industry, growing by leaps and bounds,” she said.
Retail, by comparison, showed little change. “Retail just basically stayed the same. It’s a little bit increased actually, which is surprising when you had big employers shutting,” she said. “But somehow retail keeps reabsorbing the people.”
Statistics Canada data supports that view. While the household-based Labour Force Survey shows retail employment roughly flat, payroll data from late 2025 indicates a gradual erosion of brick-and-mortar retail jobs, particularly in discretionary categories such as apparel and general merchandise.
Population Shifts Reshape Retail Geography
Beyond employment figures, Sears said migration patterns are transforming Canada’s economic landscape. She noted that the country’s three largest cities are all experiencing population outflows.
“All three major cities, Vancouver, Toronto, Montreal are in the same boat. They’re all losing population,” she said. “That’s the biggest issue we have going, is the exit from the cities.”
By contrast, several provinces are seeing growth. January’s data showed employment increases in Alberta, Saskatchewan, and Newfoundland and Labrador. Sears said those trends reflect broader lifestyle changes.
“The population is on the move. The population is changing priorities for retail,” she said. “If you’re selling fast, hectic, crazy, it’s just not going to work.”
She suggested Canadians are shifting toward a slower, more experience-driven lifestyle. “Canada has decided to have a more European culture. We’re probably less American today than we were even a year ago in what we value.”
Changing Attitudes Toward Work and Lifestyle
Sears said the labour market changes are tied closely to evolving social values. She pointed to back-to-office mandates that took effect at the start of the year as an example.
“You see a great number of these back-to-work mandates that kicked in on January 1st. Women decided they weren’t going back. There’s a huge number who simply said, that was it,” she said.
According to Sears, these decisions reflect a broader re-evaluation of priorities. “Canadians have had a change of heart about how they live, where they live, what they call work. Values have changed. Quality of lifestyle has become much more important.”
Those shifts are also influencing spending patterns. Sears said experience-oriented sectors are benefiting from the change. “It’s a great time if you’re in the events business,” she said.
Regional Divergence and Economic Outlook
Provincial employment trends are also diverging. Ontario saw a decline of about 67,000 jobs in January, while Alberta gained about 20,000. Sears said Alberta’s performance reflects both population growth and economic momentum.
“Alberta’s been strong. It’s actually doing quite well in jobs and it’s gained some population,” she said.
She added that the Maritime provinces have also attracted new residents, reinforcing the theme of population redistribution across the country.
Despite the soft January data, Sears remains optimistic about the broader outlook. “By Q3, I think you’re going to see we’re in a much stronger position. I think it’ll be a good year,” she said.
She expects unemployment to trend lower over the next year. “We should be somewhere around six per cent by this time next year, if not slightly better,” she said.
Sears pointed to infrastructure spending and new trade agreements as factors that could support employment growth. “With all these investments starting to have shovels in the ground, I honestly think there’s nowhere to go but up.”
Wage Growth and Consumer Spending Implications
Average hourly wages rose 3.3 per cent year over year in January to about $37.17. Sears said ongoing labour force exits could push wages even higher.
“The more people who drop out of the workforce, which is a continuing trend, the higher the wages will be,” she said. “The higher the wages, the more disposable cash Canadians will have to drive the consumer economy.”
That dynamic could support retail sales even in a slower employment environment, particularly if consumers shift spending toward experiences and lifestyle-focused goods.
Discount Retail Careers Versus Luxury Pressure
Sears also highlighted contrasts within retail employment, particularly between discount chains and luxury stores. She said discount retailers are increasingly seen as long-term career options.
“Dollarama actually is a career now. It’s absolutely a career, and it’s a respectable one,” she said. “People love working for these guys. They like how they’re treated.”
She noted similar sentiments among employees at other value-focused chains. “People love working for Giant Tiger. Absolutely love it,” she said.
In contrast, Sears said luxury retail environments often carry higher pressure and internal competition. “You get a lot more discontent in luxury, primarily because the pressure’s so high,” she said.
She described scenarios where competition for high-value sales creates tension among staff. “In a luxury store, you might have lost a $100,000 sale. The pressure is intense.”
Retail Stability Masks Structural Change
Overall, the Canadian retail labour market appears relatively stable at a national level, with only modest month-to-month fluctuations. However, Sears said that stability hides deeper structural shifts driven by demographics, migration, and changing values.
“It’s not a great jobs report, but it’s very telling if you know how to read the data,” she said. “Canadians are adapting and shifting. They’re changing their values, their expectations, their directions.”
Sears believes the current period may ultimately be seen as a turning point. “If we look back in five years, we’ll say this was the birth of Canada as a going-forward nation,” she said.
