The country’s labour market held up better than expected in November, with nearly 25,000 net new jobs created.
The employment gains consisted of an increase of 59.6k full-time positions and a loss of 34.7k part-time jobs, according to data released this morning by Statistics Canada. The unemployment rate ticked up one basis point to 5.8%.
“While the headline increase was better than expected, the ongoing increase in the unemployment rate is the bigger story, and likely better reflects the state of the economy,” noted BMO’s Benjamin Reitzes.
The largest gains in November were seen in manufacturing (+28k) and construction (+16k), while job losses were concentrated in wholesale trade (-27k), and finance, insurance, real estate, rental and leasing (-18k).
Regionally, job gains were heavily concentrated in Alberta, with “decent gains in B.C. and Ontario as well,” Reitzes noted. Gains were more modest in the Maritimes while Quebec also saw a small decline. Manitoba currently boasts the country’s lowest unemployment rate at 4.9%.
StatCan also reported a 4.8% year-over-year rise in average hourly wages to $34.28, unchanged from October.
Implications for the Bank of Canada
Today’s employment figures don’t change expectations for a rate hold at next week’s Bank of Canada rate meeting, economists say.
“Today's report, alongside yesterday's negative GDP print, will be enough for the Bank of Canada (BoC) to hold its policy rate steady when it meets next week,” wrote TD’s James Orlando. “While we aren't expecting the BoC to signal victory, the Bank will be able to project greater confidence that the process is working.”
And while rate hikes largely appear off the table at this point, most believe it will be some time yet before the Bank is ready to pivot to rate cuts.
“The BoC will…be cautious about pivoting to rate cuts too quickly, but our own assumption is that they will start to push the overnight rate lower in the second half of next year,” wrote RBC assistant chief economist Nathan Janzen.
December employment data will be released on January 5, 2024
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Nikole Rolof, Edmonton Mortgage Broker