Unemployment rate ticks up to 5.5% in July as job creation lags population growth

OTTAWA –

Canada’s unemployment fee rose once more final month, because the financial system struggles to create sufficient jobs to match the tempo of inhabitants development.

Statistics Canada reported Friday employment was little modified in July, falling by 6,400 jobs.

Meanwhile, the unemployment fee ticked as much as 5.5 per cent, marking the third consecutive month that the unemployment fee has risen.

Prior to that, it was hovering at 5 per cent for 9 consecutive months, simply above the record-low of 4.9 per cent reached final summer season.

As Canada’s inhabitants continues to develop quickly, rising unemployment indicators the financial system is not creating sufficient jobs to soak up a bigger workforce.

“We’ve seen a consistent increase in the number of people without a job in Canada, but people that are still in the labour force,” stated James Orlando, TD’s director of economics.

Job vacancies have additionally declined within the nation, providing one other signal that the labour market is loosening.

Orlando says excessive inhabitants development helps the financial system keep afloat as newcomers add to demand. So as an alternative of excessive rates of interest resulting in outright job losses, Orlando says the unemployment fee is rising.

“When people come to Canada, even if they don’t get a job right away, they’re consumers, right? They’re looking for housing, they need to buy food, they need to buy clothes. And so they’re buying stuff within the economy. And that is a demand shock,” Orlando stated.

“It’s putting a floor under the economy at a time when most people would have thought it would be contracting.”

The federal company says job losses final month had been led by the development trade, whereas the best job features had been made in well being care and social help.

High rates of interest are anticipated to push unemployment even larger as borrowing prices rise for each companies and shoppers.

The Bank of Canada has raised its key rate of interest to five.0 per cent, the best it has been since 2001.

The central financial institution is hoping its aggressive fee hikes gradual the financial system down sufficient to carry inflation to its two per cent goal.

It’s cited concern concerning the tempo of wage development as effectively, which rebounded in July, rising 5.0 per cent 12 months over 12 months.

Inflation in June fell to 2.8 per cent, throughout the Bank of Canada’s goal vary of 1 to 3 per cent. But core measures of inflation which strip out volatility present costs are nonetheless rising rapidly and new forecasts from the central financial institution counsel it expects inflation to get again to 2 per cent by mid-2025.

A fast have a look at Canada’s July employment (numbers from the earlier month in brackets):

• 
  Unemployment fee: 5.5 per cent (5.4)
• 
  Employment fee: 62.0 per cent (62.2)
• 
  Participation fee: 65.6 per cent (65.7)
• 
  Number unemployed: 1,166,800 (1,147,100)
• 
  Number working: 20,166,400 (20,172,800)
• 
  Youth (15-24 years) unemployment fee: 10.2 per cent (11.5)
• 
  Men (25 plus) unemployment fee: 4.6 per cent (4.4)
• 
  Women (25 plus) unemployment fee: 4.8 per cent (4.4)

Here’s a fast look at unemployment charges for July, by province:

• 
  Newfoundland and Labrador 8.7 per cent (8.8)
• 
  Prince Edward Island 8.1 per cent (8.2)
• 
  Nova Scotia 7.7 per cent (6.4)
• 
  New Brunswick 6.2 per cent (6.4)
• 
  Quebec 4.5 per cent (4.4)
• 
  Ontario 5.6 per cent (5.7)
• 
  Manitoba 4.9 per cent (4.3)
• 
  Saskatchewan 5.1 per cent (4.7)
• 
  Alberta 6.1 per cent (5.7)
• 
  British Columbia 5.4 per cent (5.6)