FILE PHOTOS: “Please look for” signs visible in a bakery window in Ottawa, Ontario, Canada, November 2, 2017. REUTERS / Chris Wattie
OTTAWA (Reuters) – Canada unexpectedly got 289,600 jobs in May even when the unemployment rate hit a record high of 13.7%, data showed on Friday, supported by easing restrictions on living in homes in parts of the country.
Job benefits are far better than expected. Analysts in a Reuters poll estimated a loss of 500,000 jobs and an unemployment rate of 15.0%.
“I think this might be considered the biggest job gain in Canadian history for a month but it’s also still a drop in terms of recovering jobs lost during March and April,” said Nathan Janzen, senior economist at RBC. Canada lost 2 million record-breaking jobs in April.
Canadian dollar CAD = rose to a three-month high of 1.3395 per US dollar or 74.65 US cents. The United States, Canada’s biggest trading partner, also posted a surprising rise for May.
“This is just another sign that activity in North America hit rock bottom in April and resumed in May,” said Douglas Porter, chief economist at BMO, adding: “We still have a long way to go.”
The May data did not capture 1.4 million people who lost their temporary jobs due to the closure of COVID-19, but are not currently looking for work, StatsCan said. If the figures were calculated, the unemployment rate in May would be 19.6% instead of 13.7%.
The record unemployment rate is driven in part by students entering the summer job market who must actively find work to benefit the government’s COVID-19. The unemployment rate for returning students rises to 40.3 percent compared with 13.8 percent in May 2019, Statscan said.
Jobs in the goods-producing sector gained 164,700 jobs, led by manufacturing and construction. The service sector gained 124,900 positions, led by wholesale and retail trade, as well as accommodation and food services.
Additional reporting by Dale Smith in Ottawa, Fergal Smith, Jeff Lewis and Moira Warburton; Editing by Nick Zieminski and Jonathan Oatis
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