Canada adds 48,300 jobs, but wage growth slips

The country’s labour market continues to pump out new jobs, but Canadians are seeing wage increases fade and their work hours shrink.

Last month, the job market unexpectedly added 48,300 net new positions, thanks to surges in part-time and private-sector work, Statistics Canada said Friday.

The January employment survey showed an increase of 32,400 part-time positions and a smaller gain of 15,800 jobs in the more-desirable category of full-time work. Both numbers, however, were too low to be deemed statistically significant.

The report also found that private-sector jobs rose 32,400 between December and January, compared with an increase of 7,700 public-sector positions.

The increases helped drop the unemployment rate last month to 6.8 per cent from 6.9 per cent.

Economists described the overall job growth, which once again defied their expectations, as “very impressive” and “remarkably strong.”

“It seems as if we are all thinking that streak is going to come to an end and it just keeps on going,” said Desjardins senior economist Jimmy Jean, noting the number beat the consensus prediction for a sixth straight month.

But even with more people working, Jean said the composition of the labour data remained sub par due to some “lingering weakness.”

He pointed to the disappointing growth in hourly wages in January compared with a year earlier. Hourly earnings increased by less than 1.3 per cent, which was below inflation.

In the past, Jean said hourly wages have often grown between two and three per cent, and sometimes even a little bit more.

Jean noted that the Bank of Canada had expressed concerns about hours worked and earnings growth and didn’t think the latest jobs data would ease its preoccupations, even if overall the job market continues to expand.

Other experts also pointed to the slumping wage and work hours increases.

“It’s disappointing to see that we had a decline in hours worked — we also saw very weak wage growth,” said Craig Alexander, chief economist for the Conference Board of Canada.

Alexander was encouraged that the “surprising” amount of job creation that Canada saw in the second half of last year has continued into 2017.