Statistics Canada released its June 2018 Labour Force Survey which shows 32,000 jobs added to the Canadian economy. While unemployment rose by 0.2 percentage points to 6.0 percent, this was due to an increase in job seekers.
32,000: The economy added 32,000 jobs in June.
6.0%: The unemployment rate rose to 6.0 percent.
3.6%: Wages increased 3.6 percent over the last year.
The 32,000 jobs added in June beat analyst expectations. Many of the gains were in important sectors like construction, manufacturing and natural resources. The rise in the unemployment rate is due to the addition of nearly 76,000 job seekers to the labour force which suggests that more Canadians are optimistic that they can find work due to the strong economy. Year-over-year wage growth is relatively strong at 3.6 percent.
The aggregate job gain figures in June do not tell the whole story. Canada added only 9,100 full-time jobs in June and 22,700 part-time positions. The services sectors lost 14,700 jobs mostly because of big decreases in accommodation and food services positions. The wholesale and retail trade also had a significant decrease in jobs last month.
Additionally, the job gains only came from three provinces: Ontario, Saskatchewan and Manitoba. Everywhere else the market either shed jobs or remained flat.
Trade uncertainties with the U.S. cast the biggest shadow over economic forecasts for the coming months. NAFTA renegotiations dominate and undermine the outlook for the export sector. This is particularly important for the non-energy sector, which has already had several industries being subjected to tariffs this year.
Additionally, these numbers were released just days before the Bank of Canada’s decision on interest rates. Analysts expect that despite the trade concerns, employment and wage growth numbers are strong enough to prompt an increase in the benchmark.