Quebec: The Private Sector Helped Limit Job Losses in March

The first wave of US tariffs came into effect in March. Overall, employment didn’t post any material changes, but some deceleration did occur in the first quarter of the year, with 7,400 jobs added (see table for details). This figure contrasts sharply with the two previous quarters, when the average increase was 40,000 jobs per quarter.

But the details paint a different picture, depending on whether you take a pessimistic or optimistic view. Full‑time employment veered sharply into negative territory over the quarter. All the same, private‑sector employment increased for the eighth month in a row, suggesting that it’s holding up somewhat in this uncertain environment (graph 2). It’s the public sector that is dragging employment down, in line with the Government of Quebec’s budget consolidation efforts. Educational services and public administration are two of the sectors that pulled back in March.

While the trade war did escalate substantially on Wednesday, we can see that employment did fairly well in Quebec over the first quarter, despite last month’s clear slowdown from the pace set in the last months of 2024. Business confidence indicators suggest that we won’t see much improvement.

Unfortunately, our “pessimistic scenario” from a few months back is becoming a reality. We expect Quebec’s labour market to deteriorate significantly in the months ahead, and the unemployment rate may climb to 7% by year end.