Canada Jobs Report: According to the new job report, Canadian employers continued to create new jobs in March, with over 34,700 and close to 35,000 jobs added in March, about three times more than expected in earlier forecasts by economists and also below the jobs created in February.
The good side of the Jobs Report
The headline number from the Labour Force Survey was more than four times higher than the consensus of a 7,500 gain from economists surveyed by Bloomberg Economists who have all been expecting the economy to add about 12,000 jobs during March and that should mark an increase in growth compared to February.
Unlike the United States Jobs Report for March, almost all the new Canadian jobs were in the private sector, as the civil service sector and self-employment were both minimal. The transportation and warehousing, business support services, and real estate sectors were the top gainers. However, unfortunately, the construction industry lost jobs in March.
Some sectors saw hiring going up, especially service sector jobs like:
- Transportation and warehousing sectors, which added 41,000 workers.
- Building and other support services sectors, up 31,000.
- Finance, insurance, real estate, rental and leasing sectors added 19,000 people.
Unemployment Rate so far
The unemployment rate in Canada held on for the fourth month so far at 5.0 per cent. Employment, however, rose slightly with 35,000 positions added last month, the government agency said, with job gains concentrated in the private sector. Average wage growth remained strong at 5.3 per cent year-over-year, which is lower than that of February.
Some sectors saw hiring going down, this still led to unemployment in some sectors jobs like:
- The construction sector is down 19,000 workers.
- “Other services” (which includes personal and repair services) lost 11,000.
- Natural resources sectors lost 11,000 jobs.
Bank of Canada’s goal
The new job report for March is not in line with the Bank of Canada’s goal of cooling the labour market. While higher job statistics were good news for Canadian workers, it was not good news for the Bank of Canada and the economy more broadly.
Government Rates Hike
The new Canadian jobs reports have led to economics expecting the central bank to hold on rates in its next meeting on April 12. It has been a thorn in the Bank of Canada’s side, repeatedly holding up more than expected against rate hikes meant to slow the economy.
Starting from September 2022, the jobs report has generally trended upward with 383,000 more people employed since then till now, according to Statistics Canada.
“While the Bank of Canada is expected to remain on hold next week, the still low unemployment rate and strong wage growth will likely see policymakers maintaining a bias towards further hikes, rather than hinting at the cuts markets have been pricing in, within the statement,” Andrew Grantham, senior economist at CIBC Capital Markets, said in a note to clients.
The central bank has predicted the labour market will slow in the coming months as higher borrowing costs ripple through the economy.