'Economic uncertainty, more than AI itself, is emerging as the primary driver of caution'
Canadian HR leaders are entering the second half of 2026 with the weakest hiring outlook in North America, according to a report.
Canada's Net Employment Outlook (NEO) is at 12 per cent — compared to the 26 per cent global average and the United States at 45 per cent. Puerto Rico is at 48 per cent while Mexico registered 28 per cent.
Overall, 16 per cent of employers globally reported they were anticipating staff reductions while 42 per cent said they planned to increase their staff between July and September and 40 per cent of employers said they planned to keep staffing levels unchanged, found Manpower Group.
"What the data this quarter reveals is a labour market navigating uncertainty while pursuing selective opportunity," said Jonas Prising, ManpowerGroup chair and CEO.
He added that the hesitation is rooted in economics rather than technology.
"Economic uncertainty, more than AI itself, is emerging as the primary driver of caution, particularly across Europe, Asia, and large enterprises... The organizations moving forward most confidently are those aligning their people strategy with their technology strategy."
The Net Employment Outlook is derived by taking the percentage of employers anticipating an increase in hiring activity and subtracting from this the percentage of employers expecting a decrease in hiring activity.
Canada's labour market rebounded sharply in May, adding 88,000 jobs and pushing the unemployment rate down to 6.6%, according to Statistics Canada's latest Labour Force Survey.
AI use in hiring
Despite growing AI adoption, a person reviewing resumes (57%) remains the most valued hiring resource, finds Manpower, ranked above all AI and automated tools:
- Automated status update and communication tools: 48%
- AI-assisted job description writing: 46%
- AI-driven resume screening, parsing, and sourcing: 44%
- AI-enhanced tools helping workers understand their skills, career paths, and opportunities: 43%
- Always-on AI solutions matching people and roles, with final human oversight: 41%
"AI is probably our best opportunity to reverse the adverse economic and productivity trends that Canada has been experiencing for half a century," Joel Blit, associate professor of economics at the University of Waterloo, previously told Canadian HR Reporter.
