Canada gains surprise 289,600 jobs in May, jobless rate hits record

OTTAWA (Reuters) – Canada unexpectedly gained 289,600 jobs in May even as the jobless rate hit a record high at 13.7%, data showed on Friday, buoyed by the loosening of stay-at-home restrictions in certain parts of the country.

The job gains were far better than expected. Analysts in a Reuters poll had predicted a loss of 500,000 jobs and an unemployment rate of 15.0%.

“I think this probably counts as the largest job gain in Canadian history for one month but it’s also still just a drop in the bucket in terms of recovering the lost jobs over March and April,” said Nathan Janzen, senior economist at RBC. Canada lost a record-breaking 2 million jobs in April.

The Canadian dollar CAD= extended its rally after the release to hit a three-month high at 1.3395 per U.S. dollar or 74.65 U.S. cents.

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  • Canada adds net 289,600 jobs in May

The May data did not capture the 1.4 million people who had temporarily lost their jobs due to COVID-19 closures, but are not currently looking for employment, StatsCan said. Had those numbers been counted, the May unemployment rate would have been 19.6% rather than 13.7%.

Employment in the goods producing sector gained some 164,700 jobs, led by manufacturing and construction. The services sector gained some 124,900 positions, led by wholesale and retail trade, as well as accommodation and food services.

The previous record for the highest unemployment rate since Statistics Canada adopted their current labor force model in January 1976 was the 13.1% seen in December 1982.

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