Canadian employment rose by 46,400 in January, following 2,900 drop in December. Full time jobs were increased by 64,300, which was partially offset by 17,900 reductions of part time jobs.
Most working places were shaded in professional, scientific and technical services providing sector. 30,200 people found jobs in this sector. This gain is the highest level among the components of “service industry”. Thereby, this sphere of economy increased employment by 64,700 year over year. In spite of the crisis in the US real estate market Canadian construction firms hired 19,500 employees. Furthermore, employment in this sphere was soared by 85,100 during the last twelve months.
There was also stated a significant employment increase in financial and insurance services, as well as agriculture sectors. After disappointing data in December companies of manufacturing sector managed to create 17,500 jobs. However, during the last twelve months 113,400 people have lost their jobs in manufacturing sector, which ensured 5.4% slippage in employment over year.
These decreases were partially offset by falls in recreation and food services, trade and mining spheres. In January employment in recreation and culture services providing sector tumbled down by 27,600 or 3.5%. Retail trade fired 26,500 people. As a result, the growth in the trade industry was only 1.2% over year. After Christmas and New Year holidays 10,900 people lost their jobs in accommodation and food services industry. Even so, unemployment rate dropped by 0.1% to 5.8%, the lowest rate since 1974 (chart 1). Moreover, average hourly wages climbed to 4.9% over year, which has been the highest rate during the last ten years.
Negative impact of manufacturing employment reduction, due to the strength of the Canadian dollar and higher competition on part of the emerging countries, was fully offset by job growth in the whole economy, thanks to record high commodity prices and relatively low interest rates.
However, further slippage of unemployment rate will be limited in medium term, as higher prices of oil have a political nature and growth rate of immigration is increasing. The US economic growth deceleration will have additional negative impact on labor market and will cause unemployment increase mainly in manufacturing.
CANADA ECONOMIC INDICATORS
Chart 1
Source: Bank of Canada, Bloomberg
