The last employment report before the October 19 federal election has to be disappointing for the Harper campaign. The unemployment rate edged up to 7.1 percent–slightly higher than the 7.0 percent posting in August–and employment grew a mere 12,000, in line with modest expectations. At least job seekers must be a bit more optimistic as the number of labour force participants increased last month–some discouraged workers resumed their job search. Another negative note was sounded as part-time employment rose by 74,000–not a good sign–which was almost offset by a disappointing 62,000 decline in full-time employment. The number of self-employed workers increased, public sector employment was down and the number of private sector jobs was little changed.
This rounds out third quarter employment growth at only 31,000–below the meager 32,000 gain in Q2 and the 63,000 rise in Q1, neither of which were stellar quarters. In September, all of the net job growth was among people aged 55 and older and was little changed for other demographic categories. Clearly, many boomers prefer to continue working either by necessity or choice (probably a combination of both).
Employment was up in British Columbia and Alberta and down in Ontario.
The Bank of Canada’s next rate decision is scheduled for October 21. Nothing in this report is likely to trigger a rate cut. Meantime, yesterday’s release of the U.S. Federal Reserve’s policy committee minutes indicated that the Fed was in no hurry to raise rates. With the disappointing U.S. September jobs report released last week, expectations of an October Fed rate hike have dissipated and many expect the Fed to remain on the sidelines for the remainder of this year.
This, and a recent surge in oil prices, have spurred a dramatic rise in the Canadian dollar to over 77 cents. Today’s report, however, will undoubtedly take some of the steam out of the loonie’s flight. Stock markets have had a great week on news of the Fed’s reluctance to raise rates. Odd, because stock markets sold off following the September Fed decision to delay lift-off. Markets, as ever, are fickle.