June 10, 2024

Weekly EconMinute—May 2024 Labour Force Survey

In this week’s EconMinute, we’re talking about the May 2024 Labour Force Survey.

Adding support to the Bank of Canada’s recent decision to cut interest rates, the Canadian labour market took a step back in May, adding just +27k jobs. This corresponded with a small uptick in the unemployment rate to 6.2% (+0.1%).

The uptick in unemployment was most noticeable in Alberta which saw its jobless rate rise from 7.0% in April to 7.2% in May. There was a spike in unemployment in BC as well, while other markets showed more resilience.

Of note, higher unemployment in Alberta was not just a matter of more people looking for work as the province’s population booms. May marked the first sizable drop in the province’s employment since September of last year, and drove jobs losses nationally.

From a more regional perspective, the biggest weakness is seen in the market with the strongest population growth: Calgary. Not only does Calgary have the second-highest unemployment of major markets, it has also seen a large increase in unemployment over the last year.

As jobs growth fails to keep pace with population growth, more Albertans are finding themselves unemployed for longer durations (3 months or more). That said, other indicators that typically point to a weakening labour market—e.g., accepting part-time work or giving up on the search for work—remain stable.

But what drove jobs loses in May? Mainly, construction. While employment changes in construction are not uncommon, what’s noticeable is that employment in the industry sits in line with where it was a couple years ago, despite the increase in housing demand.

Though May was overall a weaker month for Alberta’s labour market, it’s too soon to say whether this marks a temporary blip (as was seen last year) or a longer-term slowdown. One good news story worth noting is that the gap in wage growth between Canada and Alberta has closed.

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