Canada’s unemployment rate rises to 5.5% in July, economy unexpectedly sheds jobs

OTTAWA, Aug 4 (Reuters) – The Canadian economy unexpectedly shed a net 6,400 jobs in July, entirely in part-time work, while the jobless rate ticked up to 5.5%, Statistics Canada data showed on Friday.

Analysts polled by Reuters had forecast a net gain of 21,100 jobs and for the unemployment rate to edge up to 5.5% from 5.4% in June.While headline figures indicated some slowness, the average hourly wage for permanent employees – a figure the Bank of Canada watches closely – rose 5.0% from July 2022.

That was higher than the 3.9% annual rise in June, but lower than May’s 5.1% and April’s 5.2% year-over-year increases.Canada’s labor market, supported in part by strong immigration, has been resilient even as the Bank of Canada raised its key overnight rate ten times since March 2022 to cool the economy.

Including July’s losses, Canada’s monthly employment growth has still averaged 22,000 this year, Statscan said.Some 8,100 jobs were shed in part-time work, more than offseting a marginal gain in full-time employment.

The goods sector lost a net 27,500 positions, driven by construction jobs, while services sector gained 21,200 jobs, helped by gains in health care and social assistance as well as educational services industries.