Canada lost 43K jobs in June while Sask. unemployment rate drops

Looking ahead, Kavcic said BMO is expecting a “meaningful slowdown in the economy later this year.”

However, the numbers were different for Saskatchewan as the province added 22,300 jobs, an increase of 3.9 per cent compared to June of 2021.

The seasonally adjusted unemployment rate fell to 3.9 per cent last month, the second-lowest among provinces in the country. That was down from 6.6 per cent a year ago, down from 4.8 per cent a month ago, and well below the national average of 4.9 per cent.

“Saskatchewan’s economy continues on a strong and enviable growth path with a low unemployment rate and significant job gains,” Immigration and Career Training Minister Jeremy Harrison said. “Our government will continue to support the job creators and workers to accelerate our economic growth in communities across the province.”

For two straight months, many all-time employment records were hit, including overall employment (592,900), female employment (276,300), off-reserve Indigenous employment (67,400), and off-reserve Indigenous full-time employment (55,700).

Major year-over-year employment gains were reported for healthcare and social assistance up 8,200 jobs, construction up 4,000 jobs, and accommodation and food services up 3,400 jobs.

Over the same period, the private sector added 19,000 jobs (+5.8 per cent), female employment increased by 11,300 jobs (+4.3 per cent), and youth (aged 15-24) employment was up by 6,000 jobs (+7.1 per cent).

The Bank of Canada is expected to raise its key interest rate on Wednesday, with most economists predicting a hike of three-quarters of a percentage point.

A recent study from the Canadian Centre for Policy Alternatives warned rapidly increasing interest rates will likely send the Canadian economy into a recession and could cause significant “collateral damage,” including 850,000 job losses.

For now, though, CIBC chief economist Avery Shenfeld said the Bank of Canada wouldn’t be dissuaded from raising interest rates more aggressively, noting an increase of 1.3 per cent in hours worked and the decline in jobs being offset by lower labour force participation.

“On its own, the headline jobs decline isn’t yet convincing evidence of a slowdown that will deter the Bank of Canada from a 75 basis point hike next week,” Shenfeld said in an email.

June’s decline in the unemployment rate is attributed to fewer people looking for work, Statistics Canada said, while the loss in jobs was driven by a decline in self-employment by 59,000 jobs.

For business owners, a decline in the labour force participation rate only adds to their labour shortage woes.

Mark Kitching, owner of Waldo’s on King bistro and wine bar in London, Ont., says hiring challenges are ongoing. He says he could hire two or three additional kitchen staff but isn’t getting applicants.

“I talked to people in my industry and we’re all having the same problem,” said Kitching.

The vacancies at Waldo’s mean staff have to work overtime hours, which Kitching says makes it more expensive and stressful to operate.

June also saw a faster pace of wage growth, with average hourly wages rising 5.2 per cent year over year to $31.24.

Kavcic said previous wage growth numbers were lagging and didn’t capture “reality on the ground.”

“These numbers are now better-reflecting conditions in the real economy,” he said.

In comparison to wage growth prior to the pandemic, June recorded the fastest growth since the collection of comparable data in 1998. However, the rise in wages in June was still below the most recent inflation rate of 7.7 per cent reported in May.

Wage growth was led by gains among non-unionized workers, who saw their wages go up by 6.1 per cent, while unionized workers experienced a slower rise in wages of 3.7 per cent.

Employment in the public and private sectors held steady.

Jobs in the services-producing sector declined by 76,000, erasing gains made earlier in the year. The largest decline in employment was in retail trade. The report said data over the next few months may help answer whether the decline was due to consumer behaviours changing as inflation remains high.

Employment in the good-producing sector rebounded, with 33,000 jobs added.

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by The Canadian Press/paNOW Staff

Canada lost 43K jobs in June while Sask. unemployment rate drops

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