The latest establishment survey data from Statistics Canada pointed to gains in wages and hiring in B.C., but with abated upward momentum.
Average weekly earnings rose 0.2% in November to $983.05, following a 0.6% increase the previous month. Nationally, average weekly earnings rose 0.3%.
While various factors influence weekly earnings, including industry composition and hours worked, wage gains have been solid. Year-over-year wage growth was up a moderate 3.2% – the highest among provinces – easily outpacing a 2% national gain. B.C.’s recent growth trend is the strongest since 2014. A tight labour market, an unemployment rate below 4.5% and the highest job vacancy rate in the country continue to drive wage inflation.
Gains have varied among sectors but are led by relatively higher-paying industries. Specifically, forestry and logging levels were up 20% to $1,437, with mining and quarrying up 10% to $2,083. That said, both make up a small share of overall employment. Strong growth of 9.2% to $1,386 was observed in the information and cultural industries, which include a portion of technology workers. Other sectors with above-average gains included construction (up 6.8%) and retail trade (up 8.2%), increases that reflect high levels of building activity, a lack of trade workers and generally solid domestic demand.
On the hiring front, payroll counts increased for a seventh straight month and the ninth time in 10 months. Total counts increased 0.1% from October to 2.31 million persons. Year-over-year growth of 3.7% (or more than 82,600 positions) was the second strongest among provinces and exceeded the national gain of 2.3%.
While some of the growth momentum has tapered, higher earnings and employment point to solid growth in labour income of about 5%. This will continue to support consumer demand in the economy, although higher interest rates and debt accumulation will limit credit-induced spending.
Small-business confidence in B.C. softened in January, according to the latest Business Barometer reading published by the Canadian Federation of Independent Business. At 57.3 points, the index declined by 2.8 points from December 2018. This was higher than the national reading of 56.1 points, but near the bottom end of the readings observed since the 2008-09 recession.•
Bryan Yu is deputy chief economist at Central 1 Credit Union.