Canada’s economy pumped out 35,000 new jobs in October nearly twice as many as economists were forecasting, Statistics Canada reported Friday.
The agency said the employment gains were driven by a rise in full-time positions which swelled by 88,700, while part-time employment dropped by 53,400 jobs, the second consecutive month of part-time job losses.
The unemployment rate increased to 6.3 per cent, up from 6.2 per cent in September as more people joined the labour market in search of jobs.
The biggest employment gains were for youths aged 15 to 24, with 18,000 more new full-time jobs. At the same time, their unemployment rate rose 0.8 percentage points to 11.1 per cent, as more of them searched for work, the data agency said.
The largest employment increase was in Quebec, followed by Alberta, Manitoba, Newfoundland and Labrador, and New Brunswick. At the same time, there was a decline in Saskatchewan, Statistics Canada reported.
Economic ‘sweet spot’
“The economy is in something of a sweet spot, as economic slack is gradually giving way to rising capacity pressures and growth evolving back towards its longer-term trend,” Fotios Raptis, senior economist at TD, wrote in a research note. “But, inflation remains relatively subdued with some evidence that wage growth is persistently ticking upward, and housing and trade risks help skew risks toward the downside.”
This removes any immediate urgency to raise interest rates from current levels, but more signs of rising capacity pressures will eventually lead the Bank of Canada to another rate hike as early as January 2018, Raptis said.
Construction and manufacturing up, retail down
Employment rose in several industries with jobs in good-producing industries leading the gain, adding 33,900 positions, driven largely by construction, which added 18,400 jobs. There was also a notable uptick in the manufacturing sector, which added 7,800 jobs and was up by 51,000 (+3.0%) on a year-over-year basis, the report said.
However, employment declined in wholesale and retail trade with 36,000 job losses.
The number of private sector employees increased in October, while public sector employment and self-employment were little changed.