Canada’s labour market posted its strongest monthly gain in six months in May, with employment rising by 88,000 and the unemployment rate falling to 6.6 percent from 6.9 percent in April. The employment rate increased to 60.7 percent.
Full-time jobs accounted for the gain. Employers added 154,000 full-time positions in May, reversing losses recorded earlier in the year. Part-time employment fell by 66,000.
The May increase followed a weak start to 2026. Employment had declined by a net 112,000 positions from January through April. Although unemployment moved lower in May, the national jobless rate remained above levels commonly seen before the pandemic. About 26.3 percent of unemployed Canadians found work in May, below the pre-pandemic average.
Employment increased among workers aged 15 to 24, with youth employment rising by 22,000. The youth unemployment rate fell to 13.4 percent from 14.3 percent in April. Despite the improvement, youth unemployment remained above pre-pandemic levels and continued to be one of the weakest areas of the labour market.
The summer job market improved for students compared with a year ago. The unemployment rate among returning students aged 15 to 24 was 18.0 percent in May, down from 20.1 percent a year earlier.
Construction led employment gains, adding 27,000 jobs. Information, culture and recreation added 19,000 positions, transportation and warehousing gained 19,000, while accommodation and food services added 17,000. Manufacturing employment increased by 15,000 during the month, though the sector remained below levels recorded in early 2025.
Retail employment moved in the opposite direction. Wholesale and retail trade lost 35,000 jobs in May and employment in the sector was down 64,000 from a year earlier.
Ontario recorded the largest provincial gain, adding 42,000 jobs. British Columbia added 25,000 positions and Alberta gained 14,000. Saskatchewan lost 6,100 jobs. Alberta recorded the strongest year-over-year employment growth among the provinces, with employment up 4.1 percent from May 2025.
Unemployment rates fell in Canada’s largest urban centres. Toronto’s unemployment rate dropped to 6.8 percent, while Montréal and Vancouver recorded rates of 6.5 percent and 6.4 percent respectively. Toronto’s rate was well below the 9.0 percent level reached during parts of 2025.
Average hourly wage growth eased to 3.0 percent from 4.5 percent in April. Average hourly earnings reached $37.24, up $1.10 from a year earlier.
Unemployment fell, full-time hiring increased, and several industries added workers. However, the unemployment rate remained above pre-pandemic levels, retail employment continued to decline, and job-finding rates remained below historical averages.