Edmonton's unemployment rate was 7.5 per cent in July, up from seven per cent in June.
The Statistics Canada report shows the heaviest hit sectors were energy, accommodation, food and education.
The city estimates that roughly 5,700 jobs were lost in Edmonton.
"I can't explain what went on to cause that loss in jobs in the education sector, but it's unnerving as the education sector, health care and public administration have been three pillars of real strength for Edmonton and helped stabilize our economy in this whole downturn," Edmonton Chief Economist John Rose told CTV News Edmonton.
The Alberta Teachers' Association (ATA) says that funding uncertainty is forcing school boards to be more cautious.
The UCP government has not yet passed a budget this year.
"Without that certainty, in terms of funding, then they did not necessarily fill temporary positions or probationary contracts of teachers at that time," said Jason Schilling, president of the Alberta Teachers' Association.
He said the association has heard examples of one or two to dozens of teachers who have not had their contracts renewed.
“Teachers would have concerns that any kind of cuts to funding or a lack of clarity around funding could have a greater impact on the classroom come the fall,” he added.
Edmonton's unemployment rate is two per cent higher than the national average. Rose is confident that the rate will improve before the end of 2019.
With files from CTV News Edmonton's Joey Slattery
