Unemployment sees steep drop regionally as job growth in Canada takes breather in June

Senior Economist Royce Mendes with CIBC wrote in a note to clients Friday he does not expect the market will pay too much attention to the pause in hiring, as job growth has looked blazing hot over the past year and in the second quarter.

“Indeed, the immediate investor reaction appeared to reflect the positive data on faster wage growth in Canada and strong US non-farm payrolls, the latter allaying some fears, at least for now, that Canada’s largest trading partner is shifting into a much lower gear,” he wrote.

Provincially, employment is up in Alberta and Saskatchewan. Decreases were noted in Manitoba, Newfoundland and Labrador and little change was reported in the remaining provinces.

Employment gains came in health care and social assistance, educational services, transportation and warehousing, and information, culture and recreation. The number of employees increased in June, while the number of self-employed declined.

Saskatchewan realized nearly 2,500 new jobs in June, with most of the growth coming in accommodation and food services. Full-time and part-time work rose by 700 and 1,700, respectively.

This pushed the unemployment rate down one tick from 5.2 to 5.1 per cent as the participation rate, which represents those either working or actively looking for work, rose from 68.8 per cent to 69.

Data for Prince Albert and Northern Saskatchewan, which included figures for the region, shows a steep drop in unemployment year-over-year, down to 6.7 per cent from 7.8 this time last year.

However, the labour force shrunk from 106,100 people from 107,600. Since June 2018, those participating in the workforce slid incrementally from 67.1 from 67.4.

Minister of Immigration and Career Training Jeremy Harrison called the number’s “very, very good news.”

He said more people are working today in Saskatchewan than ever been with nearly 593,000 jobs. He said 9,200 jobs have been created over the course of the last year and the province has seen over 11 consecutive months of job growth.

“It’s really a testament to the job creators here in the province who are creating these jobs and creating opportunity for Saskatchewan people,” he said.

The minister said continuing wage growth is another indication of the economy’s strength, despite low energy and commodity prices and headwinds from federal government policies.

Harrison said the influx of new jobs in the private sector over the past year alongside continued growth nationally should boost business and investor confidence.

Asked how he thinks the data will influence the central bank’s interest rates, Harrison expects long term rate increases after historically low rate for a long period after the financial crisis.

“That’s very much dependent on inflation figures that we would be seeing coming out of other markets or any national numbers which is really the motivating force and factor for decisions taken by the bank on rates,” he added.

Harrison said the upcoming federal election and government policy will play a large part in keeping the job market strong.

“We continue to be concerned about federal government policies around energy development, around energy exports, around the lack of capacity to export energy products and the result that we end up having, transportation bottlenecks and other areas of the economy as well,” he said. “All of the trade challenges that we are facing whether it be in China or Italy or India or Saudi Arabia. All of these things are very problematic and we’re keeping a close eye on as well.”

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tyler.marr@jpbg.ca, nikita.ganovicheff@jpbg.ca

On Twitter: @JournoMarr

by Tyler Marr and Nikita Ganovicheff

Unemployment sees steep drop regionally as job growth in Canada takes breather in June

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