Saturday, September 23, 2023

Canada Jobs Forecast: Big Five Banks Forecast, Tens Labor Market

Canadian jobs data for May will be released by Statistics Canada on Friday, June 9 at 12:30 GMT and as we get closer to the time of the release, forecasts from economists and researchers from the Big Five banks regarding the next employment data will follow. are given here.

The US economy is expected to add 23,200 jobs after creating 41,400 jobs in April. The unemployment rate is expected to rise one digit to 5.1%. If so, it would be the first increase in the unemployment rate since August 2022. Meanwhile, the participation rate is expected to remain stable at 65.6%.


We expect job growth to slow to 25,000 in May, slower than the recent trend of 57,000, and the unemployment rate to hold steady at 5.0%. We expect a return to full-time employment after a decline in April, as well as hiring in the services sector, to drive headline data. We also expect wage growth to remain at 5.1%, down 0.1 percentage points from last month.

RBC economics

After an increase of 250,000 between January and April, we expect employment in Canada to increase by another 20,000 in May. However, the unemployment rate is expected to continue rising as “excess” demand for labor continues to decline. Job postings are down about 20% from March highs, consumer delinquencies have risen in recent months and job attrition rates have slowed.


The labor market has been exceptionally strong, with an increase of 344,000 jobs over the past six months. And while there are few signs of the next reversal, we believe this momentum is unsustainable in the medium term. So we expect further modest gains in the coming months with a result of 20,000 in May. Despite this improvement, and assuming that the participation rate remains unchanged at 65.6%, the unemployment rate could still increase by one-tenth to 5.1%, the result of another strong expansion of the active population.


We expect employment to remain stable in May, with the unemployment rate still rising to a low of 5.2%. The loss of employment may be partly due to wildfires in May that limited activity. Nevertheless, we expect some of the employment decline to be offset by continued strong immigration with higher participation rates. Working hours would be a useful and more timely indicator of global activity growth than other activity data. We expect hourly wages for full-time workers to remain strong in May, up 5.1% year-over-year. Wages and employment data in general will continue to be an important factor in watching for risks to a potential rate hike after June.


Rapid population growth is creating a large pool of potential workers, but cooling demand due to earlier interest rate hikes should cause employment gains to begin to lag behind population growth. While the 20,000 jobs we forecast for May would have been considered strong, they will be so weak in 2023 that the unemployment rate will climb to 5.1%.

World Nation News Desk
World Nation News Desk
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