Canada Surprises With 290k Net New Jobs In May – Jobs Report

The proportion of workers working from a location other than home increased from 60% in April to 65% in May. The largest employment increases in Quebec were in construction (+58,000), manufacturing (+56,000) and wholesale and retail trade (+54,000), three industries with a relatively high proportion of jobs that are difficult to do from home. The fact that Quebec has a higher share of jobs that are difficult to perform off-site goes a long way to explaining why its rise in unemployment earlier this year was so extreme, and why its recovery now is so impressive.

Montreal’s unemployment rate (15.2%) is now in line with Canada’s two other largest cities, Toronto (15.4%) and Vancouver (14.1%), with the latter two having seen a rise in unemployment in May.

Ontario, home to Toronto, was the only province to see a loss in net job creation in May (-65,000). Most restrictions on economic activity remained in place in Ontario when the jobs data was gathered, as Ontario’s government has taken a more cautious approach to reopening the economy. We may expect job creation in Ontario to grow through the summer months as its phased reopening unfolds.

British Columbia added 43,000 jobs in May and the unemployment rate rose 1.9 percentage points to 13.4% as more people looked for work. Almost all of the employment increase in B.C. were in the services-producing sector (+41,000), led by accommodation and food services (+12,000), educational services (+12,000), and wholesale and retail trade (+12,000). Like Ontario, B.C. should show stronger employment figures over the coming months.

Meanwhile, unemployment in Alberta now stands at 15.5%, while the Prairie provinces of Saskatchewan (12.5%) and Manitoba (11.2%) are holding steady as their phased reopenings take shape. Out East, Newfoundland (16.3%) now has the highest unemployment rate in Canada, despite 10,000 new jobs in May, while Nova Scotia (13.6%), PEI (13.9%), and New Brunswick (12.8%) are all within a percentage point of the national average.

Is Canada over the worst of the pandemic?

In purely economic terms, the Bank of Canada’s latest outlook is that Canada avoided the worst-case scenario and the impact on the global economy has peaked.

“This impact appears to have peaked, although uncertainty about how the recovery will unfold remains high,” the Ottawa-based central bank said in a statement. “Decisive and targeted fiscal actions, combined with lower interest rates, are buffering the impact of the shutdown on disposable income and helping to lay the foundation for economic recovery.”

Will more jobs be created in Canada this summer?

The latest Jobs Report for May shows a snapshot of Canada’s economy in the earlier stages of the reopening. As more businesses and services reopen and if the phased reopening of provincial economies can continue as planned, it may be expected that more people who were laid off in March and April can return to work.

Moreover, some jobs — such as infrastructure projects, among others — will require new workers entirely. 

“The outlook for infrastructure projects in Canada remains strong, particularly in water, transportation, and power,” says Ruairi Spillane, Managing Director of Outpost Recruitment, an agency specialising in engineering and construction.

“With increased municipal and federal spending assigned to boost Canada’s aging infrastructure network and these works classified as essential during the pandemic, there will be a strong pipeline of work. Employment prospects remain exceptionally bright across Canada’s infrastructure sector.”