Job surge helps push Canada’s unemployment rate to lowest in over 40 years
Data another sign Canada is on the path back to growth
Canada’s labour market continued its strong run of job gains, bringing the unemployment rate down to a fresh low and adding to evidence the country is emerging from a recent slowdown.
The economy added 27,700 in May, Statistics Canada said Friday in Ottawa, bringing the gain over the past 12 months to 453,100. The unemployment rate fell to 5.4 per cent, the lowest in data going back to 1976.
Friday’s report reaffirms the labour market as the main driver of Canada’s expansion, and adds to a recent run of data showing clear signs the country is on the path back to growth after stalling at the end of last year. The currency jumped on the report, which is seen to give the central bank more ammunition to resist pressure to lower borrowing costs.
The Canadian jobs report contrasts with weaker-than-expected payroll data in the U.S. that’s fuelling concern of a broader slowdown there and boosting calls for a Federal Reserve interest-rate cut.
Canada’s report “was a good number with strong details, in contrast with pretty soft numbers in the U.S.,” Shaun Osborne, chief foreign-exchange strategist at Scotiabank, said by phone from Toronto.
“This suggests greater capacity for the Bank of Canada to stay on hold if the Fed does cut rates.”
Economists forecast Canadian employment to rise by 5,000, after a record gain of 106,500 in April.