Canada’s unemployment rate was little changed for a third consecutive month in July, rising 0.2 percentage points to 5.7 per cent as more people searched for work, according to Statistics Canada.
The agency’s monthly Labour Force Survey showed that the country lost 24,200 jobs in July after a decline of 2,200 jobs in June. Part-time employment fell by 12,600, and full-time jobs declined by 11,600 positions.
The number of private-sector employees fell by 69,000 in July, with a notable decline in wholesale and retail trade. The number of public-sector employees was little changed, while the number of self-employed workers increased by 28,000.
“The July employment dip was softer than market expectations, but is still not really surprising,” RBC senior economist Nathan Janzen wrote in a research note on Friday morning. “Outsized growth in prior months has for some time looked out-of-step with other measures of economic growth like GDP.”
He’s calling for employment growth to soften into the second half of 2019.
Wages were a bright spot in the July figures. Hourly pay climbed 4.5 per cent, the strongest annual increase in more than a decade.
“The big news was the further strength in wage growth,” Capital Economics senior Canada economist Stephen Brown wrote in a research note on Friday. “It is a risk to our view that the Bank of Canada will cut interest rates in October.”
The construction sector went on a hiring spree last month, adding 25,000 jobs with notable increases in Quebec and Alberta. Wholesale and retail trade employment fell for a second consecutive month. Transportation, natural resource and service jobs declined as well.
Employment in Alberta dropped by 14,000 jobs in July, all in full-time work. Quebec saw employment rise by 17,000. Figures for Ontario and British Columbia were little changed for a second consecutive month.
The labour force survey sample size is approximately 56,000 households, resulting in the collection of labour market information for about 100,000 individuals.
Derek Holt, head of capital markets economics at Scotiabank, called for a gain of 25,000 jobs following June’s flat performance.
“Canadian employers hired 247,500 workers over the first half of 2019. If the second half matches this performance, that would put the economy on track for a half million new jobs,” he wrote in a research note last week. “While that’s impressive, it’s not a record breaker. In fact, it’s not even close.”
CIBC Capital Markets chief economist Avery Shenfeld predicted at “slight uptick” in the jobless rate, and a tepid employment change, in a research note ahead of the data’s release.
He warned investors not to put too much stock in the monthly figures due to a “large sampling error component that make one-month readings hazardous to your trading health.”