Canadian Labour Market Continues Its Pause in May
Canadian job growth took another pause in May, with employment ticking down 7,500 and the unemployment rate remaining flat at 5.8% for the fourth straight month. The steady unemployment rate reflected a slight drop in the labour force, while the headline employment number was held up by an uptick in part-time work. Following a sharp drop this January and fairly tepid movement since then, it’s becoming clear 2017’s banner job growth won’t be repeated in 2018.
The most concerning sign in the May report was a noticeable decline in the prime age employment rate. The share of Canadians aged 25-54 with a job recently reached an all-time high of 82.7%, but fell 0.4 percentage points in May, reversing gains made over the prior year.
That said, the May jobs report continues to reflect a generally strong labour market. The 5.8% unemployment rate still represents substantial progress from earlier years, and a pick up in annual wage growth to 3.9% signals that the tighter labour market is starting to show up in Canadians’ pay cheques. Notwithstanding current uncertainty of Canada-US trade relations, recent data suggest a continued solid outlook for Canadian job seekers.