October Labour Force Survey: A Sleepy October After A Wild Summer
The unemployment rate ticked down as fewer youth were looking for work.
Not much new in today’s job numbers. The October LFS was a bit of a sleeper following a series of wild, exaggerated monthly swings this past summer. The unemployment rate ticked down as fewer youth were looking for work. The employment rate of Canadians age 15-24 is down over the past year, in contrast to improvement among those age 25-54.
One positive sign in this report was to see a third straight monthly decline in the average duration of unemployment. Jobless spells in Canada have been elevated despite the low unemployment rate. However there had been some progress outside resource-rich provinces, including Ontario, BC, and Quebec, which continued in October.
One of the potential benefits of a tightening labour market is that it should help reduce the typical length of unemployment – it’s encouraging to see some improvement in this regard in regions where labour market slack is declining. More concerning is the lack of progress in provinces like Alberta and Saskatchewan, where jobless spells haven’t come down much after rising in the aftermath of the oil price crash.
Lastly, all eyes have been watching wage growth, a key input into the Bank of Canada’s calculus for its future rate path. Despite reports from Canadian businesses of growing labour shortages, average hourly earnings growth has fallen back, suggesting tighter conditions haven’t yet shown up in paychecks.