Canada’s unemployment rate rose to seven per cent in May, Statistics Canada said Friday, the highest level since 2016 excluding the pandemic, as sectors most vulnerable to President Donald Trump’s trade war lost jobs.
Statistics Canada said that in May there were 1.6 million unemployed people in the nation with a population of 41.6 million.
That marked a 13.8 per cent increase compared to May of last year and the highest unemployment rate Canada has recorded in a decade, excluding 2020 and 2021, when the COVID pandemic upended the labour force.
Royal Bank of Canada senior economist Claire Fan said the data highlighted the early impact of Trump’s tariffs.
“Sectors that are the most exposed to trade headwinds, namely manufacturing and transport and warehousing shed jobs,” Fan said.
She specifically pointed to Windsor, Ont., the heart of a Canadian auto industry directly targeted by Trump’s tariffs, where the unemployment rate hit nearly 11 per cent last month.
But the job figures still beat some analysts’ expectations, indicating the Canadian economy is showing resilience in the face of Trump’s protectionism.
“Job growth has looked very weak this year, but importantly the labour market has not shown signs of major destruction tied to the trade war just yet,” said Royce Mendes, head of macro strategy at Desjardins.
