Participation rate

Understanding the participation rate 

What is the participation rate?

The participation rate is the share of the working-age population that is participating in the labour market.  A person is considered to be participating in the labour market only when they are either employed or unemployed.  

What does the participation rate tell us about imbalances? 

On its own, the participation rate is not a direct measure of labour market imbalances. However, when interpreted alongside other indicators, such as the unemployment rate, it can reveal subtle yet important nuances in the labour market.  

For example, a declining unemployment rate on its own might suggest that workers are finding employment more easily and that job opportunities are plentiful. However, if the participation rate is also declining, it may indicate that unemployment is falling because fewer people are looking for work, rather than because more people are finding work.  

In this case, additional indicators, such as vacancy rates or long-term unemployment, can help identify structural supply and demand imbalances in the labour market. 

Table notes

• The participation rate is calculated as the number of people in the labour force (employed and unemployed) divided by the working-age population.
• Data is sourced from Statistics Canada’s Labour Force Survey (LFS).
• Changes in the participation rate may reflect shifts in labour market conditions, demographics, or individuals entering or leaving the labour force.
• The participation rate should be interpreted alongside other indicators, such as the unemployment rate and job vacancy rate, to assess potential labour market imbalances.
• Data for provinces is available from January 1976 onwards, while data for territories is available from March 1992 onwards for Yukon, and January 2001 and January 2004 for Northwest Territories and Nunavut, respectively.
• Data is collected separately for provinces and territories; overall Canadian rates reflect provincial data only, while territorial data is provided as three-month moving averages due to sample size constraints.