Canada’s unemployment rate will end this year almost exactly where it is now, says CIBC economist Emanuella Enenajor. Employers will add to their payrolls throughout 2013, but not enough to improve on our current 7.1% national jobless rate. “We’re looking for the unemployment rate to track around 7.2% by year-end,” she says. Enenajor and I spoke yesterday.
Enenajor’s call contrasts somewhat with Canada’s recent performance. The economy added 39,800 jobs in December and a whopping 59,300 jobs in November. Both results came in well above expectations (analysts predicted just 5,000 jobs last month). In fact, the November and December numbers put together come close to matching the number of jobs added in all of 2011.
“In the last six months, we’ve had average hiring of about 26,000 per month, which is quite elevated relative to historic numbers,” says Enenajor. “There is a possibility that this pace of hiring will slow. We’re certainly not calling for contractions in employment. We do think there’s going to be tepid growth in the economy that will necessitate a bit of hiring, but somewhere closer to the 10,000 to 15,000 range.”
Still, the new numbers are good news. December was the fifth straight month in which the economy added jobs. Confidence was shaken back in July when employment declined by 30,000 following two months of flat growth.
In another positive sign, both the November and December results show strong growth in full-time private sector positions.
Part-time employment dropped by 1,400 jobs last month while full-time employment rose by 41,200. The public sector produced just 3,200 additional jobs while the private sector grew by 59,400. Some of those folks exited the ranks of the self-employed; that category dropped by 22,800 in December.
Five provinces added jobs in December: Ontario had the highest number with 33,000, followed by Manitoba (5,200), Saskatchewan (4,000), Newfoundland and Labrador (2,700) and Prince Edward Island (1,300). The December numbers were flat in New Brunswick, Quebec, Alberta and British Columbia. The Nova Scotia economy lost 5,000 jobs during the month.
Employment rose in both the goods- and services-producing sectors. The best month-over-month numbers came in transportation and warehousing (up 21,500) and construction (up 17,800). The sharpest downturns were felt in professional, scientific and technical services (down 41,500) and in natural resources (down 13,900).
Enenajor says the strong results in November and December could produce a slight gross domestic product boost in early 2013, because those new workers have a bit of money to spend. But overall the Canadian economy is in for a less than stellar year. In her words, watch for “subdued growth” this year and an unemployment rate that reflects that.
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