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Canadian employment rebounds in May as unemployment rises

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Canadian employment rebounded sharply in May, as part-time work accelerated and the number of people in the labour force rose.

Canada added 25,800 jobs in May, following a decline of 28,900 the prior month, Statistics Canada reported today in Ottawa. Economists forecast employment to rise 25,000. The unemployment rate edged up 0.1 percentage points to 7 percent as more people entered the labour force. The participation rate eased slightly from 66.2 percent to 66.1 percent.

Compared to May 2013, the number of people employed increased by 0.5 percent or 86,000, with all the growth in part-time jobs. Over the same period, the number of hours worked was relatively unchanged.

The gains were led by the educational services sector, which added 22,000 jobs in May. Employment levels in this sector were little changed compared to the previous 12 months.

Employment in accommodation & food services advanced 20,000, partially offsetting the previous month’s decline.

The number of people in agriculture increased 19,000, official data showed. Year-on-year, employment in this sector was relatively unchanged.

Employment in natural resources declined 23,000 in May, bringing employment in the sector back to around the same level as the previous 12 month period.

Finance, insurance, real estate & leasing saw employment levels fall 21,000 in May. Employment in this sector has declined in three of the past four months. Year-on-year, finance and related employment declined 2.9 percent.

Gains in part-time work likely reflect the rise in summer youth employment. Youth employment increased 49,000 in May, official data showed. The youth unemployment rate was 13.3 percent, little changed from the previous 12-month period.

Year-on-year, employment in the private sector increased 1.1 percent or 129,000, following a gain of 1.7 percent the prior month. Public and self-employment were little changed in May.

Today’s report underlies the uncertainty of Canada’s labour market, which has taken turns creating and destroying jobs each month. The April jobs report diminished optimism the labour market may be stabilizing after a rocky winter season. Net employment declined 44,000 in December and then increased 29,400 in January. Employment then declined in February, rebounded in March and declined again in April.

In the United States, nonfarm payrolls rose 217,000 in May, following a downwardly revised gain of 282,000 the prior month, the Commerce Department reported in Washington today. A median estimate of economists called for a gain of 217,000.

The unemployment rate was unchanged at 6.3 percent.

The Canadian dollar was treading water after the releases, trading at 0.9151 US. The loonie has declined three-quarters of a percent against its US counterpart this week.

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