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Labour Force Survey Analysis – October 2017

Quebec and Alberta drive employment growth to its highest level since June

After three consecutive months of flat or tepid growth, Canadian labour markets showed some sign of life in October. While far from an employment boom, the addition of 35,300 new jobs – an increase of 0.2 per cent over September – was the largest monthly increase since June. Even so, that growth was not enough to prevent the unemployment rate from rising by one basis point to 6.3 per cent; the increase in the jobless rate was driven by a slight uptick in the number of Canadians actively looking for work.  

Lacklustre job creation provides further evidence that the Canadian economy is growing at a much slower pace compared to the first half of the year. On the bright side, however, the quality of the work available is improving. October marks the second consecutive month where a large number of part-time jobs were converted into full-time positions. All told, there were 88,700 net new full-time jobs created last month, while the number of part-time jobs fell by 53,400.

In September, national jobs gains were singlehandedly driven by a surge in employment in Ontario. Last month, it was Quebec and Alberta’s turn. Those two provinces accounted for 86 per cent of employment growth across Canada, with Quebec adding 18,400 jobs (an increase of 0.4 per cent), and Alberta creating 11,900 net new positions (a 0.5 per cent increase). Job gains in Quebec were driven by manufacturing, while it was knowledge-based services that did the heavy lifting in Alberta.

There were also strong jobs gains in Manitoba and across most of Atlantic Canada, as all provinces except PEI saw employment levels recover from recent losses. Meanwhile, Ontario followed up a strong September with a flat October, adding just 5,200 new jobs. Employment was down in Saskatchewan, BC and PEI.

At the industry level, job gains were once again concentrated in goods-producing industries, which added 33,900 positions, compared to 1,400 new jobs in services. Job gains on the goods side were widespread but concentrated in construction (18,400 new jobs) and manufacturing (7,800 new jobs), although there was a notable spike in agriculture employment as well (6,100 positions).

On the services side, there were notable gains in information, culture, recreation and other services, but those were mostly wiped out by a large decrease in wholesale and retail trade jobs. There were 35,900 trade-related jobs lost in October – a decline of 1.3 per cent. While these losses coincide with the announcement of the closure of Sears Canada’s operations, they do not appear related, as Sears Canada is still in the process of liquidating its assets.

Manufacturing Sector Labour Market

Manufacturers continued to recover from the loss of 13,700 jobs in August as the sector added 7,800 net new positions in October – an increase of about 0.4 per cent. Overall employment in manufacturing reached 1.74 million last month – just shy of August levels, which were the highest in four-and-a-half years.   

Although employment has yet to recover August’s peak, 2017 has been an undeniably good year for manufacturing workers across Canada. Through 10 months, there have been 18,300 new jobs created in the sector and annual employment is tracking towards its highest level in four years.

Across Canada, manufacturing jobs gains were driven by Quebec, which added 12,100 positions last month – an increase of nearly 2.5 per cent. New Brunswick and Nova Scotia also saw relatively large increases, with manufacturing employment up 2.5 per cent and 1.6 per cent in those provinces, respectively.  BC saw notable jobs gains as well.

Meanwhile, manufacturing employment growth was flat or negative across the rest of the country. Ontario added a modest number of new jobs, but employment was down across the prairies, as well as in PEI and Newfoundland and Labrador.

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