07:09 AM EDT, 06/12/2025 (MT Newswires) -- The May employment figures for Canada were welcomed with a sigh of relief from markets, as they weren't nearly as weak as expected, said Bank of Montreal (BMO).

Some parts of the report were encouraging, with big increases in full-time and private sector employment.

Unfortunately, it wasn't all good news, noted the bank. The uptick in the unemployment rate to 7% stands out, but it's the underlying details that are a bit more worrying.

The number of permanent layoffs has trended higher over the past few years, moving back to the higher end of normal, though from extremely low levels, stated BMO.

That stats has steadied in the past six months, but should

be watched for a further leg higher.

The other metric highlighted is new entrants to the labor force, added the bank. Past sharp increases have coincided with recession, not a good sign.

Part of the move higher likely reflects the surge in immigration over the past few years -- such as international students graduating -- but that doesn't make it any less concerning.