By Promit Mukherjee
OTTAWA, June 5 (Reuters) - Canada's economy added 87,800 jobs and the unemployment rate fell back to 6.6% in May, data showed on Friday, defying widespread expectations and showing signs of some resilience despite signs of softer economic growth.
This is the first month this year of job gains and helped wipe off almost 80% of all job losses posted since the year began. The last time the economy added a significant number of jobs was October last year, Statistics Canada said.
Analysts
polled by Reuters had forecast the unemployment rate to hold at the six-month high level reached in April at 6.9% and had predicted net additions of 10,000 jobs in May.
Canada's economy has weathered an onslaught of U.S. tariffs and trade uncertainty for more than 12 months, hitting some crucial sectors very hard and leading to job losses. It has also sucked hiring momentum and investments out from the broader economy.
Its economy hit a technical recession - two consecutive quarters of economic contraction - at the end of the first quarter on an annualized basis. But economists have been divided on whether Canada was actually in recession as there have been no widespread job losses and some sectors have shown healthy growth.
Statistics Canada said employment increased in several industries such as construction which added a net of 26,800 jobs, information, culture and recreation which saw an addition of 19,300 jobs, transportation and warehousing which saw gains of 18,700 jobs and accommodation and food services which grew by 17,000 jobs.
The wholesale and retail trade sector, which accounts for almost 14% of the total employed work force, posted job decline of 35,000 positions in May.
Economists have said that the upcoming football World Cup, partly hosted by Canada, will also likely boost jobs in the months of June and July across some sectors.
The job additions was fully concentrated in full-time jobs which saw a net addition of 154,000 in May, reversing almost all of the first four months of net job losses in full-time work, StatsCan said, and added part-time employment fell by 66,200 in the month.
Average hourly wages of permanent employees, a metric closely tracked by the Bank of Canada to gauge the rise in inflation expectations, grew 3.2% in May, a sharp decline from the 4.8% posted in April.
The unemployment rate for youth declined 0.9 percentage points to 13.4%, StatsCan said, adding this was the first decline since January.
(Reporting by Promit Mukherjee; Editing by Dale Smith)
