Canada: Unemployment rate sees an unexpected dip

According to Statistics Canada, 48,300 jobs were unexpectedly added to Canada’s labour market in January 2017, driving the unemployment rate down to 6.8%, thanks to increases in part-time and private-sector work. The dip in the unemployment rate defied economist expectations which had projected job numbers to stay unchanged in January and for the unemployment rate to hold at 6.9%. The majority of the new jobs were created in the services sector and mostly in areas such as finance, insurance, real estate, business management, transportation and warehousing.

Despite the increase in jobs, the growth in hourly wages compared to a year earlier was low at less than 1.3%. Hours worked also saw only small growth from the same time last year, increasing by 0.2%, due to a rise in part-time work. Craig Alexander, chief economist for the Conference Board of Canada, described these figures as “disappointing”.

The proportion of consumers not at all concerned about their current financial situation increased significantly over the last 12 months, from 7% in H2 2015 to 19% in H2 2016, suggesting that Canadians are feeling the flow on effects of positive economic news for the country.

The decline in hours worked and weak wage growth does not seem to be rubbing off on consumers, with RFi Group data showing that the proportion of consumers not at all concerned about their current financial situation increased significantly over the last 12 months, from 7% in H2 2015 to 19% in H2 2016, suggesting that Canadians are feeling the flow on effects of positive economic news for the country.


Source: RFi Group Canadian Priority & Retail Banking Council 16H2

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