A Very Hot Canadian Labor Market
July 9, 2010
Canadian jobs jumped 93.2K last month, which is the same percentage increase as a 707K increase of U.S. non-farm payroll employment. A broadly-based increase of service sector jobs accounted for the entire rise. Over the three months of the second quarter, service-sector employment rose 7.5% at an annualized rate, and overall Canadian employment went up 5.5% annualized. The equivalent job gain in the United States would have been a pace of 573K per month. Factory jobs contracted another 14.3K in June and have shrunk by 22.6K or 1.3% over the past year.
New IMF forecasts released yesterday penciled in Canada with the Group of Seven’s fastest projected economic growth in 2010, a pace of 3.6%, but then dropping to 2.8% in 2011, a tenth less than projected U.S. growth next year. Unlike the Fed, the Bank of Canada has begun to tighten interest rates. On June 1st, the overnight target rate was doubled to 0.5%. That tightening followed a request from the OECD that Canada’s central bank begin lifting its interest rate without further delay.
Canadian unemployment dipped to 7.9%, the first sub-8.0% result in 17 months, from 8.1% in April and May and a peak of 8.7% in August 2009. Average hourly wages went up just 1.7% in the year to June, down from 2.4% in the year to May and 3.5% in the year to June 2009.
Copyright Larry Greenberg 2010. All rights reserved. No secondary distribution without express permission.
Tags: Canada
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