According to Statistics Canada, unemployment in the country seems to be growing more and more, as the May unemployment rate rose to 7% compared to 6.9% in April. This is the third consecutive monthly increase during the year.
“The unemployment rate increased 0.1 percentage points to 7.0% in May, the highest rate since September 2016 (excluding 2020 and 2021, during the pandemic).” Statscan
They also said that the total jobless Canadians was almost 14% higher in May than a year ago, and that unemployed people had spent an average of 21 weeks searching for work in May, up from 18 weeks in May 2024.
Chart of unemployment rate rising to 7.0% in May – Statistics Canada
“Companies are reducing shifts, laying off workers, and that’s all contributing to the unemployment rate and not hiring. Everything’s slowed down in places where people consume. Higher prices mean they’re not buying as much here because we put tariffs on US goods. So the consumers here are looking for substitutes. And consumers not buying reduces the demand.” Audra Bowlus, Professor of Economics at Western University.
Bowlows also predicted that Canada would head into a recession and that the following months would be the same unless the tariffs are lifted.
The total number of hours worked in May stayed the same compared to April, but rose 0.9% compared to May 2024. Average hourly wages increased by 3.4% over the past year, with employees earning $36.14 in May, up $1.20 from last year. This matches the wage growth seen in April.
