Canadian Employment Was Unchanged In March

Canada’s Labour Force Survey estimates of employment are highly volatile on a month to month basis, and the latest figures for March continue this volatile pattern.

Following hefty increases in employment in January and February, employment was roughly unchanged in March. Canada’s unemployment rate remained unchanged at 5.8% in March. The actual figures were a 67,000-employment gain in January and a 56,000 increase in February and a 7,000 decline in March.

The average over the past twelve months was an increase of 28,000 per month. March’s job losses were caused by a pullback in the private sector employment, while the government sector and self employment both turned in some positive numbers.

Given the solid performance of employment growth over the past half year, a flat monthly report in March is not at all surprising

As of March, the year over year growth in Canadian employment was 332,000 (up 1.8%), with gains in both full- (+204,000) and part-time (+128,000) work. Total hours worked over the year increased by only 0.9%, half the rate of growth in total employment.

The latest dip in the monthly employment is consistent with the view that the Canadian job market appears somewhat stronger than the real economy.

Unfortunately, wage growth is still quite weak in Canada, as wage gains were effectively unchanged in March at a 2.3% y/y pace. Of course, there is little risk of either wage or price inflation suddenly breaking out. Indeed, the latest employment data suggest that the Bank of Canada will probably continue to sit on the sidelines this year with respect to interest rate hikes.