Canada adds ‘modest’ 22,300 jobs

flovestock

TAVIA GRANT
Globe and Mail Update
Last updated Friday, Jun. 10, 2011 9:24AM EDT

The Canadian economy created 22,300 jobs last month as growth in self employment and -- to a lesser extent, the private sector -- outweighed losses in the public sector.

The country's unemployment rate unexpectedly fell to 7.4 per cent in May, its lowest in more than two years, as fewer people looked for work, Statistics Canada said Friday.

Job growth has averaged a solid 32,700 a month so far this year, exceeding the long-term average of about 20,000, said Robert Kavcic, economist at BMO Nesbitt Burns. May's modest gains mean employment levels have grown by 273,000 over the past year.

The report “is good news amid a run of downbeat economic data,” he said in a note. “Still, growth is likely to downshift substantially in the second quarter before picking up again in the second half of the year.”

While another month of job gains is welcome news, the report revealed a few soft spots. Youth still haven't benefited much from a year of job growth, and May's gains came mostly as a result of self employment rather than any strong hiring.

Economists had expected 20,000 new jobs for the month, and an unchanged unemployment rate of 7.6 per cent.

Among sectors, employment grew in retail and wholesale trade as well as in information, culture and recreation, Statscan said. Educational services and manufacturing saw declines.

Public administration was little changed as gains relating to census-gathering offset declines in other areas of federal administration.

Full-time employment increased by 33,000 in May. Over the past year, full-time work has grown 1.6 per cent while part-time positions have risen 1.5 per cent, the agency said.

Men aged 25 to 54 were the biggest beneficiaries of the job gains.

The jobless rate for students is lower than last year. The rate for those 20 to 24 was 15 per cent in May – much higher than the national average, but improved over the same month last year, when it was 16.5 per cent.

Among provinces, Quebec, Alberta and Saskatchewan all tallied job growth in May. Employment declined in Newfoundland and Labrador, and was little changed in other provinces.