OTTAWA: Canada lost more jobs than expected in May as lockdowns imposed to curb a harsh third wave of COVID-19 continued to weigh on the economy, Statistics Canada data showed on Friday.

Some 68,000 jobs were lost in May, more than the average analyst prediction for a loss of 20,000. The unemployment rate climbed to 8.2%, in line with analyst expectations. Employment is now 3% below pre-pandemic levels, Statscan said.

"The weakness was driven by ongoing restrictions in May," said Doug Porter, chief economist at BMO Capital Markets. "I would point out that almost all the declines were in part-time jobs, which is one mildly encouraging feature here."

Full-time employment was down by 13,800, while part-time employment fell by 54,200 positions. Employment in the goods sector fell 41,600, its first decline since April 2020, on a drop in construction and manufacturing jobs. Services sector employment fell by 21,800 jobs.

Long-term unemployment held relatively steady in May, while the participation rate for core-age women fell for the second consecutive month in May, dipping back below pre-pandemic levels. Women are more likely to drop out of the labor force when schools are closed.

Despite the disappointing May numbers, economists were quick to look ahead to June. A number of provinces are loosening restrictions, with hiring expected to ramp up as patios and seasonal businesses reopen.

"June should show a modest recovery that will transition into more robust growth readings early in the second half of the year as additional segments of the economy are reopened," said Royce Mendes, senior economist at CIBC Capital Markets.

The Canadian dollar was trading 0.2% higher at 1.2082 to the greenback, or 82.77 US cents, as the US dollar broadly lost ground.