Canada November Employment - Strong job growth came largely in the public sector
Canada’s 50.5k increase in employment was stronger than expected in November, and fully explained by a 54.2k rise in full time work. However, with 45k of the new jobs created coming in the public sector the data is less impressive than it initially seems. With unemployment up and wages slower we continue to expect a 50bps Bank of Canada easing next week.
The unemployment rate is up sharply to 6.8% from 6.5% reaching its highest level since September 2021, though the rise was due to a massive 137.8k increase in the labor force which will be difficult to sustain. The labor force gain can however be seen as a rebound from two straight below trend gains of near 15k in the labor force. Trend in the labor force is around 50k per month, making even the overall number of jobs created simply consistent with stable unemployment.
Private sector employment rose by 6.3k while self-employment fell by 0.7k. Goods producing employment fell by 20.8k with a 28.5k decline in manufacturing outweighing a rise of 18.4k in construction. Services rose by 71.5k led by retail and wholesale at 38.7k. BoC easing may be supporting construction and consumer spending.
The hourly wage rate of permanent employees slowed sharply to 3.9% yr/yr from 4.9%, its slowest for over a year, though we will need more similar figures to confirm a slowing in trend.
