TORONTO ― After several strong years, the experts have been calling for a slowdown in Canada’s job market. But so far, it hasn’t arrived.
Statistics Canada reported Friday the country added 54,000 jobs in September, piling on top of the 81,000 jobs gained the month before and pushing the unemployment rate down to 5.5 per cent.
The country gained 70,000 full-time jobs while shedding 16,000 part-time positions.
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“Canada’s labour market seems to have been vaccinated against the global economic flu going around,” CIBC economist Avery Shenfeld wrote in a client note.
But Shenfeld noted the “composition” of the job gains “wasn’t ideal” ― namely, the jobs were concentrated in one sector, health care, and much of the hiring was done by government. Private-sector employment fell by 21,000.
Still, with the jobless rate near decade lows, wages are finally beginning to pick up, rising 4.3 per cent over the past year ― a number some economists suggested is “suspiciously” high, meaning they suspect a statistical error.
The job market is “giving no sense that the economy is on the cusp of an imminent downturn,” wrote Doug Porter, chief economist at Bank of Montreal.
But there’s a caveat: “Even with the rock-solid job growth of the past year, the broader economy has remained lacklustre — while jobs are up 2.4 per cent from a year ago, real GDP is ambling along at just 1.3 per cent. Simply, strong employment is not translating into strong spending and/or output gains,” Porter wrote.
Most economists agree the strong job growth is taking pressure off the Bank of Canada to lower interest rates, and while some are seeing the next rate cut no earlier than December, Porter says not to expect a rate cut “anytime soon.”