Today’s Labour Force Survey
Today’s job numbers are good news in that they strongly suggest the economy is growing rather than slowing. Employment is up by a strong 55,000 jobs, the national unemployment rate remains at a relatively low 6.1%, and real wages are modestly rising. The overall jobs picture is a bit stronger than expected, and women are doing particularly well. (A record high rate of employment for adult women was reached in March.)
The bad news is that there is now a real danger that the Bank of Canada may decide to hike interest rates to deliberately slow the economy. This would boost the already high Canadian dollar, and deepen the ongoing manufacturing crisis.
Governor David Dodge and Bay Street bond traders should take note of some signs of Â labour market slack hidden in the overall numbers.
– Almost half of the new jobs created last month were part-time, and they were concentrated in generally low paid parts of the private service sector such as retail trade.
– The ongoing crisis of the manufacturing sector continues, with another 5,000 jobs lost in Ontario in March, and little improvement in Quebec from last month’s massive manufacturing job loss which some had blamed on the CN work stoppage..
– Adjusted for inflation, hourly wages are up by well under 1% compared to a year ago, hardly a sign of a very tight job market. Â
Modest good news should not set off fears that our economy is truly operating above capacity.