August’s jobs report broke the steady cooling streak we’ve seen over the last three months. The data came in better than expected with the unemployment rate remaining unchanged from July at 5.5%, and with the economy adding 40,000 jobs. By now, we’re accustomed to the data not (completely) playing by the rules.Marwa Abdou, Senior Research Director, Canadian Chamber of Commerce
All in all, the data reaffirmed a softening in the Canadian labour market. However, the unemployment rate remains well below pre-pandemic averages implying a tighter-than-normal labour market. This suggests that the economy has not completely returned to balance. We still need to see how these fluctuations, after unusual summer shocks like wildfires and strikes, will play out in the coming months. While there might be some relief in certain respects, it’s too early to celebrate, as we’re likely not far or safe from waving the white flag to a long-dreaded (soft) recession.
- Breaking a three-month cooling streak, unemployment rate remained flat in August at 5.5% y-o-y as Canadian employment was up by 40K net new jobs after unexpectedly shedding 6.4K jobs in July.
- Total hours worked rose 0.5% and remain up 2.6% y-o-y. Average hourly wages also rose 4.9% (still higher than 3.3% inflation rate), albeit at a slightly slower pace from July (5.0%).
- As job growth remains strong, the increase in labour force populations still outpaces recent job gains, signalling that larger employment numbers will be needed if we’re to keep the unemployment rate in line.
- By industry, we saw an uptick in jobs in professional, scientific, and technical services (+52k; +2.8%) as well as construction (+34K; +2.2%), meanwhile, as education services (-44k; -2.9%) and manufacturing (-30K; -1.6%) shed jobs.
- By gender, there were some notable gains. Employment in August also increased amongst both core-aged (25 to 54 years) men (+33K; 0.5%) and women (+21K; +0.3%). Female youth also saw an uptick in jobs (+32K; 2.4%) as employment declined for women who are 55 years and older (-27K; 1.3%).
- Regionally, provincial employment rose again in Alberta (+18K; +0.7%) and Prince Edward Island (+1.8K; +2.0%). We also saw gains in British Columbia (+12K; +0.4%) while Nova Scotia (-3.6K; 0.7%) shed employment. There was little change in remaining provinces.
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Sources: Statistics Canada; Canadian Chamber of Commerce Business Data Lab