- Canadian employment rose by 81.1k net positions. More Canadians were in the labour force, leaving the unemployment rate unchanged at 5.7%. The six month employment trend now stands at a healthy 30.3k clip.
- Part-time hiring (+57.2k) led the way, but full-time work also rose a bit, gaining 23.8k net positions. The other split was reasonably strong: Hiring was entirely private sector (+94.3) and in employees (+92.2k) as both public sector and self-employment fell.
- August’s gains came largely from the service side of the economy (+73.3k), as most subsectors rose.
- Looking at the provinces, Ontario (+57.8k) and Quebec (+19.7k) led the way. Notably, even as their labour forces grew, the unemployment rate fell in both provinces – to the lowest on record in the case of Quebec.
- Wages decelerated somewhat, but to a still-healthy 3.8% y/y pace, (albeit flattered by weak figures this time last year). Aggregate hours worked continued their seesaw pattern, up 0.7% in a reversal of July’s drop.
Key Implications
- Alright, alright, alright. With solid details top to bottom, it is hard not to like today’s report. Even the unchanged unemployment rate has a positive tone to it, coming from a rising labour force. What’s more, the employment gains in this notoriously noisy report were strong enough to exceed standard statistical thresholds – in other words, we can trust this month’s data a bit more than usual.
- Stepping back from the monthly swings, the trend remains healthy – a 30k average pace of hiring over the last six months is healthy by any measure. But, with hours worked continuing to swing wildly, the six month trend in hours is a more modest 0.3% m/m gain, leaving year-on-year growth at a modest but respectable 1.2%.
- The Bank of Canada reiterated its data dependency this week, focusing in particular on consumer spending. On its face, today’s report should be supportive of more spending, but remain cognizant of the divergence between income growth and spending in recent data. Even as labour markets have been healthy, retail sales volumes have moved sideways over the last year or so. As encouraging as today’s data is, we think concrete evidence on the consumer front will matter more in the Bank of Canada’s rate setting decisions.
