Canada’s jobless rate drops to lowest level in nearly 5 decades

Canada’s unemployment rate in April fell to its lowest level since at least 1976, which is as far back as comparable data goes.

Statistics Canada says the unemployment rate came in at 5.2 per cent for April compared with the previous record low of 5.3 per cent set in March.

According to the agency, little changed for the month with a gain of 15,300 jobs.

Bank of Montreal chief economist Doug Porter said the moderate gain in employment is a sign of much more normal conditions, but also one where the supply of new workers may be beginning to be the binding constraint on growth.

“For the Bank of Canada, this will do nothing to dissuade them from their tightening path, not with headline inflation aiming at seven per cent,” he wrote in a note to clients.

“The one item of news here that may help contain just how much the Bank ultimately needs to hike is the ongoing calmness of wages.”

The number of jobs in professional, scientific and technical services rose by 15,000 in April and the public administration category gained 17,000.

The number of people working in retail trade fell by 22,000 in April and those working in construction dropped by 21,000.

Tight labour market in recent months

Statistics Canada says a number of signs point to an increasingly tight labour market in recent months, including a drop in the number of part-time workers that would prefer full-time work.

The involuntary part-time employment rate fell to its lowest level on record at 15.7 per cent in April.

Average hourly wages were up 3.3 per cent year over year in April compared with a year-over-year gain of 3.4 per cent in March.

Statistics Canada also noted that the proportion of those making less than $20 per hour in April made up 25.9 per cent of all employees, down from 35.5 per cent in April 2019.

Meanwhile, employees earning $40 or more per hour represented 24.5 per cent of employees, up from 18.0 per cent three years earlier.

The effects of the pandemic continued to be felt in the economy as the total hours worked in April fell 1.9 per cent compared with March, due in part to illness-related absences from work. A blizzard in Manitoba also affected the hours worked in that province.