Statistics Canada released the labour market data on Friday. Canada's unemployment rate climbed to 6.8% in February from 6.6% in January. That was the highest level since September 2014.
Analysts had expected the unemployment rate to decline to 6.5%.
The number of employed people decreased by 1,000 in February, missing expectations for a gain of 21,300, after a 35,400 rise in January.
The decline was driven by job losses in the manufacturing and natural resources sector. The manufacturing sector cut 19,900 jobs in February, while natural resources lost 16,900 jobs due to lower oil prices.
The construction sector added 15,500 jobs.
Full-time employment in February rose by 34,000 jobs, while part-time work dropped by 34,900.
Self-employment grew by 3,600.
The labour participation rate rose to 65.8% in February from 65.7 in January.
The Bank of Canada monitors closely the labour participation rate.