It’s pretty much official: Canada's seven-year reign as a better place to find work than the U.S. is over.
Canada’s unemployment rate edged higher than the U.S.’s in early 2014, and has basically stayed there since. But as Statistics Canada notes, the two countries’ jobless rates are measured differently and aren’t directly comparable.
Adjusted to U.S. standards, Canada’s unemployment rate is lower than it looks in the official numbers, at 5.9 per cent in recent months. But the U.S. unemployment rate is now even lower than that, at 5.5 per cent.
“For the first time since the financial crisis, it’s noticeably easier to find work in the U.S. than in Canada,” BMO senior economist Sal Guatieri concluded in a client note Tuesday.
Guatieri published this chart of U.S. and adjusted Canadian unemployment rates going back to 2004. It shows the U.S. having much higher unemployment in the years after the 2008-09 financial crisis, then slowly closing the gap until exceeding Canada in recent months.
The reversal in the labour market is “one tell-tale sign that lower oil prices have opposite effects in the two countries,” Guatieri wrote.
Still, Canada’s job market isn’t exactly a total disaster; Guatieri points out the (U.S.-adjusted) unemployment rate is below its two-decade average of 6.7 per cent, and the latest job numbers from StatsCan were a pleasant surprise: Some 29,000 jobs created in March, versus economists’ expectations of a decline of some 10,000.
The details in that job report look a little weaker, though. Almost all the job gains were part-time, with full-time employment falling 28,000, and almost all the job gains (27,000) were thanks to government hiring.
Some areas that were supposed to benefit from the lower loonie, such as manufacturing, didn’t benefit, with jobs down 2,400. But some areas that were supposed to suffer from the oil price collapse, like Alberta, didn’t do nearly as badly as expected. The province’s job numbers were flat for the month, and next door in Saskatchewan employment rose by an unexpected 7,000 jobs.
In a report Tuesday, the IMF forecast that Canada would face sluggish job growth this year, thanks to low oil prices.
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