Alberta unemployment rate surges to 7.8% with largest decline in hours worked in 30 years

Alberta's unemployment rate surged to 7.8 per cent in May after the Fort McMurray wildfire impact was felt in industries beyond oil and gas, according to Statistics Canada.

Fort McMurray wildfire affected industries beyond oil and gas, Statistics Canada says

The number of hours worked across all industries fell 5.1 per cent in May, Alberta's largest monthly decline in 30 years, according to Statistics Canada. (Canadian Press)

Alberta's unemployment rate surged from 7.2 to 7.8 per cent in May as the massive wildfire in Fort McMurray forced production shutdowns in the oilsands, even as the province continues to deal with an economic downturn.

The total number of hours worked across all industries also fell 5.1 per cent, marking the largest monthly decline in the province in 30 years, according to Statistics Canada.

Alberta shed 40,000 full-time jobs across several industries last month, but gained 16,000 part-time jobs, for a net loss of around 24,000 jobs. Half of those job losses were in the natural resources sector, with another 7,400 in construction.

In the 12 months leading up to May, employment in the province decreased by 54,000 jobs — or 2.3 per cent.

Canada's 'weak spot'

"Alberta was the weak spot," said BMO economist Robert Kavcic in the bank's monthly labour market report card.

"One has to figure that [the Fort McMurray wildfire] caused a significant chunk of these reported job losses in May," Kavcic said in a release.

"The good news is that Ontario and Quebec each posted strong 21,600 job gains in May, more than offsetting the weakness in Alberta."

Across the county, Canada's economy added 14,000 jobs in May, a better-than-expected number that pushed the unemployment rate down two points to 6.9 per cent.

The national jobless rate is now at its lowest level since last July, Statistics Canada reported Friday.

Edmonton doing well

The city-level performance rankings put Vancouver and Toronto-area cities in the top spots, with Edmonton ranking a solid No. 3, up seven spots from last May. 

Calgary's unemployment rate was 8.1 per cent, while Edmonton's remained unchanged at 7.0 per cent, both reported as the three-month moving average.

"Curiously, Edmonton is still hanging around near the top of the ranking, likely reflecting the province's public-sector hiring binge," Kavcic said.

Public sector employment is up almost 6 per cent since last May, while the private sector has shed 5 per cent of jobs in the provincial capital.

Meantime, Calgary fell 22 spots over the past year as the fallout from the oil price collapse continues — now sharing the same 8.1 per cent jobless rate with Montreal, he noted.

"Let's just say that this is extremely rare," Kavcic noted.

One bright note

Alberta's job situation is probably even worse than what is being reported, notes ATB's Todd Hirsch, as Statistics Canada was unable to survey households in the Wood Buffalo area due to the wildfire evacuation.

"That means the jobs lost due to business closures in Fort McMurray do not even factor into the 24,000 lost jobs in May," Hirsch noted.

The only bright note on the economy is that Alberta may soon be approaching the bottom of the recession.

"With oil prices higher in recent weeks, we might be getting closer to some stability in the petroleum sector, which may stem the job losses in coming months," Hirsch said.