Unemployment in Canada is rising and jobs are becoming scarce
How does this affect the growth rate of the economy? And what does the Bank of Canada key rate have to do with inflation?
The labor market situation in Canada is getting tougher, with the unemployment rate rising for the third consecutive month. And this may indicate that the pace of economic growth will slow down.
On Friday, Statistics Canada (StatCan) reported that the number of jobs in the country fell by 6,400. At the same time, the unemployment rate rose to 5.5% because the Canadian economy is unable to create enough jobs to keep up with population growth.
According to StatCan, job losses in July were seen in the construction industry, while the largest job gains were seen in social assistance and health care.
May was a turning point for the labor market. The unemployment rate in the last month of spring rose for the first time in 9 months. Prior to that, the unemployment rate in Canada was at 5%, which is slightly higher than the historic low of 4.9% that was reached last summer.
As Canada's population continues to grow, rising unemployment may be a sign that the economy is not creating enough jobs to absorb the ever-growing labor force. Job openings are also falling, another sign of a weakening labor market.
- Newfoundland and Labrador — 8.7% (8.8% in June);
- Prince Edward Island — 8.1% (8.2% in June);
- Nova Scotia — 7.7% (6.4% in June);
- New Brunswick — 6.2% (6.4% in June);
- Quebec — 4.5% (4.4% in June);
- Ontario — 5.6% (5.7% in June);
- Manitoba — 4.9% (4.3% in June);
- Saskatchewan — 5.1% (4.7% in June);
- Alberta — 6.1% (5.7% in June);
- British Columbia — 5.4% (5.6% in June).
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