Labour market shows signs of improvement

​Canada’s labour crunch is showing signs that it’s beginning to ease up.
 
Labour data from the Canadian Chamber of Commerce Labour Force Survey June 2023 shows a slight increase in unemployment, gains in job growth in Ontario, and the slowing of wage growth. 
 
Marwa Abdou, Senior Research Director at the Canadian Chamber of Commerce, states:
 
“Canada’s labour market is turning a corner with June’s data. Coming in at the highest level in over a year, Canada’s unemployment rate edged up to 5.4%. We’re also seeing average hourly wages coming off the boil, with their slowest growth in over a year.
 
However, the headline jobs number was strong, exceeding market expectations with a gain of 60K jobs (vs. 20K consensus), driven by full-time employment.
 
Overall, the market is showing signs of strength and resilience, although wage growth is moderating while still remaining high.”
 
Last summer, unemployment hung at a near-record low of 4.9%. The jump to 5.4% represents a 0.2% increase from May and the highest level in over a year.
 
Meanwhile, the number of people working is increasing with a gain of 60,000 jobs. This job growth comes with an increase in full-time employment. The Labour Force Survey notes that much of the job gains are among men with employment of women largely staying the same through June.
 
The biggest changes in jobs by sector are:
• Wholesale and retail trade (+33K)
• Manufacturing (+27K)
• Health care and social assistance (+21K)
• Transportation and warehousing (+10K)
• Construction (-14K)
• Education (-14K)
• Agriculture (-6K)
 
While the jobs gains are welcome news, especially in the wholesale and retail trade sector, the decline in construction, education, and agriculture will be a struggle in those sectors.
 
Only Ontario (+56K), Nova Scotia (+3.6K), and Newfoundland and Labrador (+2.3K) saw increased employment. Prince Edward Island saw a decline of 2,400 jobs while the remaining provinces stayed relatively the same.
 
According to our local Workforce Development Board Eye on the Labour Market – June 2023 report, the top positions being posted by local employers in June were:
1. University professors and lecturers
2. Retail salespersons
3. Other customer & information services representatives
4. Home support workers, housekeepers & related occupations
5. Food counter attendants, kitchen helpers and related support occupations
6. Retail and wholesale trade managers
7. Social and community service workers
8. Cooks
9. Administrative assistants
10. Construction Trades helpers and labourers
 
Unfortunately, labour growth is one of the factors cited by the Bank of Canada in its recent decision to further hike its Overnight Lending Rate by 0.25 basis points to 5%. Sitting at 3.4% in May, Inflation is down from its peak, but not as low as the bank would like.
 
While last month’s labour data is largely positive for most businesses, the current economy and labour market is impacting different sectors and business models disproportionately. Rising interest rates and inflation are putting added pressure on businesses, but hopefully increased access to labour will help ease that burden.