June 2019 Labour Force Survey: Flat Jobs, Rising Wages
Momentum has cooled a bit in the past two months, but the upward trend over the past year remains solid.
Underneath the headline numbers, this report is almost a mirror image of the relatively flat job growth we saw in May. Digging deeper, self-employment fell back somewhat after a previous jump, while the number of employees rebounded.
The most notable development was a jump in hourly wage growth. Could this be a sign that the tighter labour market is starting to show up in paychecks? Wage growth had been creeping up since the start of the year, but jumped a full percentage point in June, posting a 3.8% gain from a year earlier. That said, hourly earnings in the Labour Force Survey are just one of Canada’s wage indicators, so more data is needed to confirm the trend.
With flat job numbers and rising wages, some might interpret today’s report that we’ve hit “full-employment.” Still, the 2.3% job growth over the past year has outpaced the 1.4% rate of population growth, so it’s too soon to throw in the towel on the prospects of further gains. We don’t know how low the unemployment rate can go, but hopefully broader economic conditions will remain supportive so we can find out.