Job losses recouped, wages continue hot streak
February 7, 2020
Focus Area—Canadian Economics
The Conference Board of Canada’s Senior Economist Sam Goucher offers the following insights on today's Labour Force Survey (LFS):
“The Canadian economy kicked off the new year with net job creation of 34,500 in the month of January. While this is relatively mild growth in the context of the last year, it restores employment levels after they took a significant dip in November. Year-over-year employment growth remains solid at 1.4 per cent and the unemployment rate edged closer to its all time low. With labour markets continuing to tighten, wages grew at one of the fastest monthly rates over the last two years.”
- Employment rose by 34,500 in January. The increase was supported by full-time employment, which rose by 35,700. Part-time employment fell by 1,200.
- January’s job growth erases the losses to employment levels that happened in November. Although trend employment growth has slowed over the past few months, employment is still up a solid 1.4 per cent growth compared to this time last year.
- In respect to January’s gain, most of the employment gains came from Quebec (+19,100) and Ontario (+15,900). Manitoba (+6,500) and New Brunswick (+4,600) both had significant increases in the context of their labour markets. Meanwhile, employment fell by a sizeable 18,900 in Alberta.
- By industry, job growth was strongest in manufacturing (+20,500), construction (+15,800) and agriculture (+11,500).
- The largest declines by industry were in health care and social assistance (-16,000) and other services (except public administration) (-7,600).
- The make up of Canada’s labour market has shifted slightly in favour of full time jobs since this time last year, as the number of part time jobs decreased (-0.2 per cent) and full time jobs increased (+1.8 per cent) over the same period.
- The participation rate declined slightly in January limiting labour force growth. With the number of net jobs added exceeding labour force growth, the unemployment rate tightened to 5.5 per cent. This is just slightly above the all time low of 5.4 per cent last May.
- After a surprise deceleration in December, year-over-year wage growth returned above 4 per cent in January as labour market tightness in many regions of the country continues to exert upward pressure on wages.
- Overall, job creation was mild in this month’s labour force survey, but it put Canada’s employment growth back on trend—which over the last three years has been robust.