Jobless rate dips as Canada adds jobs, but full-time work takes steep plunge
The economy got a jobcreation lift last month that nudged the unemployment rate back down to match its all-time low of 5.8 per cent — but a closer look reveals a rush of part-time work and a big decline in full-time positions.
Statistics Canada’s latest labour force survey, released Friday, showed the country lost 39,300 full-time jobs and generated 54,700 part-time positions in February. It also found the job gains were driven by an increase of 50,300 in public-sector jobs. The national unemployment rate slipped from 5.9 per cent in January to 5.8 per cent — to match its lowest level since the agency started measuring it in 1976. The jobless rate has only fallen to 5.8 per cent twice during that time, once in 2007 and again in December. Looking back, the job market added 282,500 positions for a 1.5-per-cent expansion over the past 12 months — with growth entirely due to full-time work. Canada’s year-over-year job creation last month showed signs of moderation after the number climbed above 420,000 positions in December.
Experts, including the Bank of Canada, have expected the job market’s red-hot pace from last year to cool, along with the rest of the economy as it nears full capacity. Manulife Asset Management senior economist Frances Donald said there’s very little in the jobs report that will rock the boat — and she added that in itself is very important.
“These jobs numbers fit quite well into the Bank of Canada’s cautiously optimistic Canadian narrative,” Donald said. “The Canadian job market, just like the broader economy, is decelerating somewhat, but it’s coming back down to earth in what we might consider a more-reasonable pace of gains with fewer distortions.” Donald underlined a couple of key indicators from the jobs report — the upward trend for hours worked, which suggests continued strong demand for labour in the economy, and average wage growth that’s still hovering around three per cent, which suggests more Canadians are benefiting from the healthier market. Average hourly wage growth, which is under close watch by the Bank of Canada ahead of interestrate decisions, stayed solid at 3.1 per cent. In January, wage growth hit 3.3 per cent following a steady flow of monthly increases after the indicator bottomed out at 0.5 per cent last April.
“At 3.1 per cent in February, wage growth posted a fourth consecutive month above its longer-term average of 2.6 per cent,” Sherry Cooper, chief economist for Dominion Lending Centres, wrote in a research note. She said the February reading won’t set off inflation warnings for the Bank of Canada, which noted this week that wage growth is below what it considers a normal level for an economy without labour market slack. “This suggests the bank will maintain its cautious stance,” she said.