According to Statistics Canada, the country lost 25,000 jobs, yet the unemployment rate fell to 6.5%, its lowest level since September 2024.
So… is this good news or bad news?
The answer is uncomfortable: both — but leaning negative, especially for Ontario households navigating renewals, refinancing, or job uncertainty.
Why Unemployment Fell Even as Jobs Disappeared
At first glance, a lower unemployment rate sounds positive. But the decline didn’t come from stronger hiring.
It came from fewer Canadians actively looking for work.
Labour force participation dropped to 65%
More people sat out the job market entirely
Population growth slowed sharply
More Canadians aged 65+ exited the workforce
In short: the jobless rate fell because people stopped searching, not because the economy suddenly strengthened.
Manufacturing Took the Biggest Hit — Ontario Felt It Most
The majority of January’s job losses came from manufacturing, a sector already under pressure from U.S. tariffs and weak global demand.
That pain landed squarely in Ontario:
67,000 jobs lost in Ontario
Manufacturing losses heavily concentrated in the province
Private-sector employment fell by 52,000 nationwide
Public-sector employment was largely flat
Other sectors — education and public administration — also saw declines, while gains in utilities, agriculture, and business services weren’t enough to offset the losses.
Part-Time Jobs Disappeared First (A Warning Sign)
One of the most telling details?
Part-time employment fell 1.8%
Full-time jobs rose slightly, but not enough to compensate
Part-time jobs are usually the canary in the coal mine. When they disappear, it often signals employers pulling back before deeper cuts arrive.
For many Ontario households, part-time income is what helps manage:
Variable-rate mortgage increases
Rising property taxes
High consumer debt
When that cushion disappears, financial stress builds fast.
Wages Are Rising — But Not Enough
Average hourly wages increased 3.3% year-over-year, now averaging $37.17/hour.
That’s helpful — but it still lags behind:
Elevated housing costs
Higher mortgage renewals
Insurance, utility, and grocery inflation
Wage growth alone isn’t solving affordability pressures.
What This Means for Interest Rates (And Your Mortgage)
Despite the soft job data, economists widely expect the Bank of Canada to hold rates steady.
Why?
The report is mixed
Weather distortions played a role
Policymakers remain cautious about cutting too early
Translation: rate relief isn’t coming quickly.
That’s a problem for homeowners renewing mortgages in 2026 — especially those whose income is less stable than it was a few years ago.
Why Equity Is Replacing Income as the Key Lending Factor
As employment becomes more uneven and lenders tighten rules, banks are becoming more conservative:
More income verification
Lower approved amounts
Stricter debt-service ratios
Longer approval timelines
This is where equity-based lending steps in.
At Lendworth, approvals are structured around:
Property value
Loan-to-value ratios
Exit strategy — not just employment volatility
If your income fluctuates, your equity still works.
The Bottom Line for Ontario Homeowners
January’s job report tells us one thing clearly:
The economy isn’t collapsing — but it isn’t stable either.
For homeowners, that means:
Renewals may come with surprises
Refinances may shrink
Timing matters more than rate
Flexibility matters more than ever
If your bank is slowing down, reducing your approved amount, or asking for “one more document,” it’s not personal — it’s systemic.
Your equity deserves a lender that understands today’s reality.
Need clarity before your renewal or refinance?
Lendworth provides fast, equity-based mortgage solutions across Ontario — even when banks hesitate.
📞 Talk to Lendworth before timelines collapse
🏡 Private first & second mortgages
⚡ Real decisions. Real speed. Real flexibility