Canada’s labour market continued to mend in July as third-wave restrictions eased, but the pace of recovery underwhelmed expectations.
Total employment rose by 94,000 persons or 0.5%, which was less than half of June’s 230,700-person gain and below market consensus for an increase of 175,000.
Canadian employment was still 1.3% shy of February 2020 levels. On the bright side, full-time employment rebounded after recent declines, lifting hours worked during the month by 1.3% while the unemployment rate fell to 7.5%.
Not surprisingly, growth was attributed to services-producing sectors. More than a third of the net gain was in the accommodations and food services sectors (up 3.7%), alongside increases in transportation and warehousing and finance/insurance/real estate. However, soft patterns in other sectors, and gains in only four provinces, could point to slower than expected hiring momentum.
British Columbia hiring paused in July with employment down 0.1% (or 3,100 persons) following a 1.6% increase in June, when many social restrictions were lifted. That said, levels remained higher than in February 2020, and B.C. remains the only province where headline employment has exceeded pre-pandemic levels. The unemployment rate was unchanged at 6.6%.
Provincial employment was supported by full-time gains, which increased 0.2% and largely offset a 1.1% drop in part-time employment as employers increased hours per employee. Business, building and related support services added 5,600 employees or 5.1%, suggesting increases as offices reopened. Health care and social assistance employment rose 7,700 persons or 2.1%. Construction picked up with a 4,300-person (2.1% gain). Offsetting losses came in manufacturing (down 10,900 persons or 6.2%), and information/culture/recreation (down 12,100 persons or 9.1%). Public-sector employment gains offset a slip in private-sector employment and drop in self-employed workers. Metro Vancouver outperformed the rest of the province with a gain of 5,400 jobs (0.4%) although the unemployment rate remains elevated at 7.3%.
B.C.’s export sector surged in June with international goods shipments surpassing $5 billion for the first time on record. Dollar-volume exports reached $5.13 billion, up 62% from a year ago. •
Bryan Yu is chief economist at Central 1 Credit Union.
