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Canada’s unemployment rate rises to 6.2% in May, economy adds 27,000 jobs – Daily Commercial News

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OTTAWA — Canada’s unemployment rate ticked up to 6.2 per cent in May as the job market continued to show signs of weakness.

Statistics Canada’s latest labour force survey showed the economy added 27,000 jobs last month – too modest of a gain to keep the unemployment rate from rising by a tenth of a percentage point.

The report suggests the Canadian job market continues to soften as high interest rates weigh on consumers and businesses.

Of those who were unemployed in April, just under a quarter found work the next month, the report said. That’s below the pre-pandemic average of 31.5 per cent for the same months in 2017, 2018 and 2019.

“A lower proportion of unemployed people transitioning into employment may indicate that people are facing greater difficulties finding work in the current labour market,” the report said.

More Canadians are also finding themselves working part-time because they don’t have better options.

Statistics Canada says the involuntary part-time rate, which refers to the proportion of part-time workers who could not find full-time work or worked part-time because of weak business conditions – was 18.2 per cent in May. That’s up from 15.4 per cent a year prior.

Young people have also felt the consequences of job market slowdown. The report notes that for returning students aged 20 to 24, their employment rate was down 2.9 per cent from a year ago.

Meanwhile, wage growth remained strong in May as average hourly wages rose 5.1 per cent from a year ago, reaching $34.94.

Employment was up in health care and social assistance, finance, insurance, real estate, rental and leasing, business, building and other support services as well as accommodation and food services.

Meanwhile, employment fell in construction, transportation and warehousing and utilities.

The data release comes days after the Bank of Canada opted to lower interest rates for the first time in four years, citing easing inflation and the weakening economy.

The central bank lowered its key interest rate by a quarter of a percentage point to 4.75 per cent and signalled that more rate cuts would be on the way, so long as inflation continues to slow.

©2024 The Canadian Press

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