(Bloomberg) — Canada’s labor market beat expectations with jobs gains, but a rising unemployment rate and a drop in hours worked show mounting economic weakness — especially in the finance and real estate sectors.
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The country added 25,000 jobs in November, while the unemployment rate rose 0.1 percentage points to 5.8%, the highest since January 2022, Statistics Canada reported Friday in Ottawa. The jobs figures topped expectations for a gain of 14,000 positions but matched the expected jobless rate, according to the median estimate in a Bloomberg survey of economists.
Employment in the finance, insurance and real estate sectors fell by 18,000 in November. Since July, the number of jobs in those industries has declined by 63,000, the steepest decrease of any category over the period. Canada’s major banks have been trimming staff; Toronto-Dominion Bank was the latest to announce this week it would cull thousands of positions this year and next.
Bonds fell and the loonie rose. The yield on the Canada 2-year benchmark note was 4.227% as of 9:26 a.m. Ottawa time, an increase of about 5 basis points from its level prior to the data release. The Canadian dollar was up about 0.3% on the day to C$1.3520 per US dollar.
Total hours worked fell 0.7% on a monthly basis, and were up 1.3% from a year ago. It was the biggest monthly decline since April 2022, confirming weak economic momentum in the middle of the fourth quarter and also shows that higher interest rates are already cutting into hours and employment in rate-sensitive sectors.
“These numbers suggest the economy entered the holiday season on soft footing,” Royce Mendes, head of macro strategy at Desjardins Securities, said in a report to investors. “As the lagged impacts of rate hikes continue to make their way through the economy, we expect further labor market weakness will drag down underlying inflationary pressures in the months to come. That should set the Bank of Canada up to begin trimming rates in the second quarter of next year.”
The pace of hiring is stuck below the population-driven expansion of the labor force. “We have to remember that 25,000 isn’t what it used to be,” Brendon Bernard, senior economist at Indeed, said on BNN Bloomberg Television. The working-age population grew by about 78,000 during the month, “so in that context, things are actually lagging.”
Wage growth for permanent employees held steady at 5%, slightly faster than expectations for a 4.9% rise. That’s the fifth straight month where the pace has been stuck at or above 5%, which are levels Bank of Canada Governor Tiff Macklem has said are inconsistent with a timely return to the 2% inflation target. Excess demand is gone and the economy is expected to remain weak for the next few quarters, the governor has said, which should help slow the pace of price increases.
The report came a day after gross domestic product data showed the economy unexpectedly contracted in the third quarter and consumption flatlined. Third-quarter GDP fell at a 1.1% annualized pace, nearly wiping out all the growth in the previous quarter.
The jobs data is the last key input for policymakers before the next rate decision on Dec. 6. The majority of the forecasters in a Bloomberg survey expect the central bank will keep rates unchanged for a third straight meeting and hold them at 5%, a likely end point in this tightening cycle. Markets and economists expect policymakers to start cutting rates in the first half of next year.
Ontario Cities Suffer
The participation rate held steady at 65.6% in November.
The employment rate — the proportion of the working-age population that’s employed — fell 0.1 percentage points to 61.8%. The employment rate has decreased in four of the past five months, and has generally trended down since January, when it reached a recent high of 62.5%.
The unemployment rate has risen 0.8 percentage points since April. Compared with a year ago, unemployed people in November were more likely to have been laid off from their previous job, reflecting more difficult economic and labor market conditions, the statistics agency said.
Job gains in November were led by increases in manufacturing and construction. Regionally, employment rose in New Brunswick, while it fell in Prince Edward Island and was little changed in all other provinces.
Among Canada’s largest population centers, the unemployment rate was highest in Windsor, St. Catharines-Niagara and Oshawa — all in Ontario. St. Catharines-Niagara and Oshawa also recorded the largest unemployment rate increases from April to November.
Wholesale and retail trade shed 27,000 jobs last month, and employment in the industry was at its lowest since in December last year.
–With assistance from Erik Hertzberg.
(Updates with market reaction, more details and economist comments.)
HALIFAX – A village of tiny homes is set to open next month in a Halifax suburb, the latest project by the provincial government to address homelessness.
Located in Lower Sackville, N.S., the tiny home community will house up to 34 people when the first 26 units open Nov. 4.
Another 35 people are scheduled to move in when construction on another 29 units should be complete in December, under a partnership between the province, the Halifax Regional Municipality, United Way Halifax, The Shaw Group and Dexter Construction.
The province invested $9.4 million to build the village and will contribute $935,000 annually for operating costs.
Residents have been chosen from a list of people experiencing homelessness maintained by the Affordable Housing Association of Nova Scotia.
They will pay rent that is tied to their income for a unit that is fully furnished with a private bathroom, shower and a kitchen equipped with a cooktop, small fridge and microwave.
The Atlantic Community Shelters Society will also provide support to residents, ranging from counselling and mental health supports to employment and educational services.
This report by The Canadian Press was first published Oct. 24, 2024.
Housing affordability is a key issue in the provincial election campaign in British Columbia, particularly in major centres.
Here are some statistics about housing in B.C. from the Canada Mortgage and Housing Corporation’s 2024 Rental Market Report, issued in January, and the B.C. Real Estate Association’s August 2024 report.
Average residential home price in B.C.: $938,500
Average price in greater Vancouver (2024 year to date): $1,304,438
Average price in greater Victoria (2024 year to date): $979,103
Average price in the Okanagan (2024 year to date): $748,015
Average two-bedroom purpose-built rental in Vancouver: $2,181
Average two-bedroom purpose-built rental in Victoria: $1,839
Average two-bedroom purpose-built rental in Canada: $1,359
Rental vacancy rate in Vancouver: 0.9 per cent
How much more do new renters in Vancouver pay compared with renters who have occupied their home for at least a year: 27 per cent
This report by The Canadian Press was first published Oct. 17, 2024.
VANCOUVER – Voters along the south coast of British Columbia who have not cast their ballots yet will have to contend with heavy rain and high winds from an incoming atmospheric river weather system on election day.
Environment Canada says the weather system will bring prolonged heavy rain to Metro Vancouver, the Sunshine Coast, Fraser Valley, Howe Sound, Whistler and Vancouver Island starting Friday.
The agency says strong winds with gusts up to 80 kilometres an hour will also develop on Saturday — the day thousands are expected to go to the polls across B.C. — in parts of Vancouver Island and Metro Vancouver.
Wednesday was the last day for advance voting, which started on Oct. 10.
More than 180,000 voters cast their votes Wednesday — the most ever on an advance voting day in B.C., beating the record set just days earlier on Oct. 10 of more than 170,000 votes.
Environment Canada says voters in the area of the atmospheric river can expect around 70 millimetres of precipitation generally and up to 100 millimetres along the coastal mountains, while parts of Vancouver Island could see as much as 200 millimetres of rainfall for the weekend.
An atmospheric river system in November 2021 created severe flooding and landslides that at one point severed most rail links between Vancouver’s port and the rest of Canada while inundating communities in the Fraser Valley and B.C. Interior.
This report by The Canadian Press was first published Oct. 17, 2024.
