Canadian Hiring Stalls After Several Months of Strong Growth

Production sector losses weigh on an otherwise robust Canadian labor market

After months of strong labor market performance in Canada, October’s  jobs report released today by Statistics Canada was disappointing. While unemployment held steady at 5.5%, 1.8K jobs were shed from payrolls overall, driven by losses in manufacturing (-23.1K) and construction (-21.3K). Job gains would likely have been positive were it not for layoffs of about 5,000 workers caused by the General Motors strike and spillover effects on supplier companies.  

Service sector remains resilient

Overall, however, the Canadian labour market continues to show resilience, particularly in the service-providing sector, which added 39K jobs. And despite October’s ho-hum numbers, 2019 remains Canada’s strongest year for job creation in 17 years.

Wage growth above 4% means noticeable increases in purchasing power

2019 is also proving to be a strong year for wage growth. Hourly wages are up 4.4% for women and 4.2% for men, with the fastest increases in occupations involving the arts (9.2%),  management (6.5%), and sales or services (4.6%). With inflation at only 1.9%, Canadians are experiencing a real increase in their incomes.

Some long-term concerns remain

Canada’s employment figures tend to fluctuate wildly from month to month due to statistical noise, so a one-month blip is little reason for concern. But there is cause to worry that sluggish business investment could be a longer-term drag on employment growth, particularly in the two industries that appeared to be struggle most in October–manufacturing and construction.

Julia Pollak

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Julia Pollak is the labor economist at ZipRecruiter. Working with a wider team, she helps employers, job seekers, and students get ahead of the game by gleaning and sharing insights generated from ZipRecruiter data.

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