For the fourth consecutive year since the COVID-19 pandemic, Ontario's unemployment rate has risen. The increase in 2025 was the highest non-pandemic jump in the jobless rate in nearly 15 years, according to a new labour market report released Wednesday by the Financial Accountability Office of Ontario (FAO).
Job creation slows significantly
The FAO report showed that job creation in the province showed no sign of upward momentum last year. Employment rose by 80,900 jobs (1%), down from 140,000 jobs (1.7%) added in 2024. This marks the slowest pace of job creation since 2015, excluding the pandemic years.
Job gains in 2025 were concentrated among core-aged workers and youth, in eight out of 16 major industries and in 12 of the province's 15 major cities.
Unemployment rate climbs
Job creation did not keep pace with the number of people seeking work, pushing Ontario's unemployment rate to 7.7% in 2025. This represents a 0.7 percentage point increase from the previous year and the highest jump since 2012, excluding the pandemic.
Job vacancies fell by 11.1% last year, with the overall vacancy rate dropping from 2.9% in 2024 to 2.6% in 2025. The decline in vacancies was observed across all industries and sectors. Healthcare and social assistance continued to have the highest number of vacancies for the fourth year in a row.
The unemployment-to-job vacancy ratio increased from 3.1 in 2024 to 3.9 in 2025, indicating softer labour market conditions.
Political reactions
Ontario Liberal Finance Critic Stephanie Bowman criticized the provincial government, stating that the report is a clear sign that the Doug Ford Conservative government's plans are failing to protect Ontario's workers.
"Unemployment is rising faster in Ontario than in every other province in the country, and it was getting worse long before U.S. tariffs," Bowman said. "Ontario accounts for 45% of Canada's unemployed workers, even though the province is home to only 39% of Canada's labour force."
