The unemployment rate rose to seven per cent, the highest outside of the pandemic since 2016, as employers left a greater number of unemployed workers on the sidelines amid tariff uncertainty. Overall, hiring was little changed from April, as was the percentage of the total working age population that had a job, according to Statistics Canada. (The Logic)

Talking point: There has been virtually no employment growth since Donald Trump’s inauguration as U.S. president; the employment rate is the lowest since October; the number of unemployed in May was 13.8 per cent higher than a year earlier; and nearly half of those 1.6 million unemployed had not worked in 12 months, compared with about 40 per cent in May 2024. What’s more, the employment rate of men aged 25 to 54 dropped to 86 per cent, the lowest since August 2018, excluding the COVID-19 pandemic. It might have been worse; most Bay Street economists predicted that employment would drop in May. The report hints at a certain amount of resilience, as full-time positions increased and average hourly wages rose 3.4 per cent from a year earlier, faster than inflation. As the Bank of Canada put it Wednesday, the economy is “softer, but not sharply weaker,” at least not yet.