Global| Nov 03 2006Rebound in Canadian Labor Market after Summer Pause
Summary
Canadian labor markets seem to be staging a comeback after something of a sinking spell during the summer. In October data reported this morning by StatCan, employment gained by 50,500 and the unemployment rate fell to 6.2%, the [...]
Canadian labor markets seem to be staging a comeback after something of a sinking spell during the summer. In October data reported this morning by StatCan, employment gained by 50,500 and the unemployment rate fell to 6.2%, the lowest since 6.1% in May and June.
Back in September we were puzzled about whether recent months' job losses were a sign of sagging activity, or merely a correction after an outsized rise in May. After two months of increases, we probably can conclude that the latter is the more valid conclusion. In October, at 16,555,500, employment in Canada reached a new high.
Further, the downtrend we thought we were seeing in the goods-producing sector may also be "just a phase". September and October had gains of 18,000 and 9,000, respectively, in construction, mining and utilities. We'd attribute these increases to added supply efforts in Canada's energy production. It is still the case that manufacturing jobs are declining.
Service industries have mixed performances. Some, like finance, business support services and accommodation and food services, are growing vigorously. But others, including professional and technical activities and information services, are waffling after extended uptrends. The service sector as a whole is gaining, but the sources of growth seem to be different most every month.
The unemployment rate fell 0.2 point in October. Not all of that move represents good news, though. Along with the employment growth, the number of people in the labor force flattened out. The so-called participation rate, the labor force as a portion of the population over age 15, has edged lower, reaching 67.08%, the lowest since February's 67.02%; this rate peaked at 67.34% in July. These may look like small differences, but in Canada, each 0.1% in the participation rate represents about 26,000 people who are seeking work or deciding not to seek work. All these caveats aside, the decline in the unemployment rate obviously contains more good news than bad, and we are encouraged by the October labor data, which indeed seem to confirm that the declines in the summer were perhaps a "vacation" and labor markets have picked up once again.
These national Canadian data are contained in Haver's CANSIM database. Some detail is also available for the Provinces; those data are in CANSIMR.
| Canada (Seasonally Adjusted) |
Oct 2006 | Sept 2006 | Aug 2006 | Year Ago | 2005 | 2004 | 2003 |
|---|---|---|---|---|---|---|---|
| Employment (000s) | 16,555 | 16,505 | 16,488 | 16,268 | 16,169 | 15,949 | 15,672 |
| Change, 000s/% | +50 | +16 | -16 | 1.8% | 1.4% | 1.8% | 2.4% |
| Goods-Producing | +9 | +18 | -18 | -0.4% | 0.2% | 1.7% | 1.2% |
| Service-Producing | +2 | +2 | +30 | 2.8% | 2.1% | 1.8% | 2.7% |
| Unemployment (000s) | 1,086 | 1,131 | 1,141 | 1,155 | 1,173 | 1,235 | 1,286 |
| Unemployment Rate (%) | 6.2 | 6.4 | 6.5 | 6.6 | 6.8 | 7.2 | 7.6 |
| Participation Rate (%) | 67.08 | 67.14 | 67.21 | 67.20 | 67.20 | 67.54 | 67.54 |
Carol Stone, CBE
AuthorMore in Author Profile »Carol Stone, CBE came to Haver Analytics in 2003 following more than 35 years as a financial market economist at major Wall Street financial institutions, most especially Merrill Lynch and Nomura Securities. She has broad experience in analysis and forecasting of flow-of-funds accounts, the federal budget and Federal Reserve operations. At Nomura Securites, among other duties, she developed various indicator forecasting tools and edited a daily global publication produced in London and New York for readers in Tokyo. At Haver Analytics, Carol is a member of the Research Department, aiding database managers with research and documentation efforts, as well as posting commentary on select economic reports. In addition, she conducts Ways-of-the-World, a blog on economic issues for an Episcopal-Church-affiliated website, The Geranium Farm. During her career, Carol served as an officer of the Money Marketeers and the Downtown Economists Club. She has a PhD from NYU's Stern School of Business. She lives in Brooklyn, New York, and has a weekend home on Long Island.
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