OTTAWA (Reuters) -The Canadian economy added a net 59,900 jobs in June, far more than expected, while the jobless rate ticked up to 5.4% as more people searched for work, Statistics Canada data showed on Friday.
Analysts polled by Reuters had forecast a net gain of 20,000 jobs and for the unemployment rate to edge up to 5.3% in June from 5.2% in May.
The unemployment rate in June increased for the second consecutive month and is now at its highest level since February 2022, though still below a pre-pandemic 12-month average, Statscan said.
The June jobs report is among the last economic data to be released before the Bank of Canada’s rate announcement on Wednesday. The central bank raised its overnight rate to a 22-year high of 4.75% last month over concerns about sticky inflation but said that further moves would be dependent on fresh information.
Data in the past month have shown some signs of slowdown – inflation cooling to 3.4%, tepid May jobs report and price softness in merchandise trade – but not enough to diminish market expectations of another rate hike.
A majority of economists polled by Reuters also expect the bank to lift rates by another quarter-point and then hold well into 2024.
The average hourly wage for permanent employees – a figure the Bank of Canada watches closely – rose 3.9% from June 2022, compared with a 5.1% year-over-year increase in May. It was the smallest increase in wages in 14 months.
The net jobs addition in June, the largest since January, were driven by full-time work. Employment gains were concentrated among men aged 15 to 24 as well as the core 25 to 54 age group, while employment among women of all age groups was little changed in June.
Employment in the goods sector increased by a net 9,800 jobs, mainly in the manufacturing sector, while a net 50,000 services jobs were added in June, led by wholesale and retail trade, and healthcare and social assistance sectors.
(Reporting by Ismail Shakil in Ottawa; Additional reporting by Dale Smith in Ottawa, editing by Emelia Sithole-Matarise)
