- Employment slipped 2k in June – but was still up 421k from a year ago
- The unemployment rate ticked up to a still-low 5.5%
- Hourly wage growth jumped to 3.8% year-over-year
The tiny dip in employment – given the size of ‘normal’ swings in this notoriously volatile report – does nothing to change the narrative that Canadian labour markets still look relatively solid. Employment is still up 421k from a year ago. The unemployment rate ticked up to 5.5%, but from a new multi-decade low of 5.4% in May, and labour force participation rates are still sitting around all-time highs once controlling for population aging.
Probably more importantly, wage growth jumped to 3.8% in June from 2.8% in May. The wage numbers, like the headline employment count, are notoriously volatile, so we would take the latest surge higher with a big grain of salt. Still, other wage measures have also shown signs of ticking a little higher in Q2. Recent readings provide perhaps some reason for optimism that underlying wage trends are picking up to closer to the 3% or higher rate that we would ordinarily expect at this point in the economic cycle. In any case, the labour market data will only reinforce the expectation that the Bank of Canada will not follow the US Fed with what are now widely-expected rate cuts south of the border.
