Home / Financial News / Canada’s jobs growth smashes expectations — and it wasn’t all the election

Canada’s jobs growth smashes expectations — and it wasn’t all the election

Canada's economy gained 44,000 jobs.

OTTAWA — More than 44,000 jobs were added overall to Canada’s economy in October, following meagre hiring in the previous four months, and enough to push the unemployment rate slightly lower.

But that was enough to push the country’s total employment level above 18 million for the first time.

Some of the new jobs in October were temporary positions, helped by the Oct. 19 federal election, Statistics Canada said Friday. The employment gains the previous month amounted to just 12,000, adding to a string of only marginal net increases since May, when 58,900 more people found work.


The economy has been climbing slowly out of a temporary recession that began at the start of 2015, when the global collapse of oil prices hammering resources-dependent provinces, such as Alberta and Newfoundland. Since the first half of the year, however, growth has resumed — though only marginally — helped by two interest rate cuts, the first in January and the other in July.

Canada has been relying heavily on the United States to underpin growth here, mainly through a pickup in exports — something remains at work in progress.

But a strengthening economy south of the border — U.S. employment growth has been steady and the jobless rate eased in October — should eventually translate into increased demand for Canadian products.

Statistics Canada said employment in this country grew by 44,400 last month, following a slight gain of around 12,000 in September and similar growth in August.


The employment rate eased to seven per cent in October from 7.1 per cent the previous month, the federal data agency said. Most of the jobs added last month were in the private sector and all were full-time positions.

“Overall, the economy looks to be grinding along at a pace just fast enough to absorb population growth and keep the unemployment rate pegged at around seven per cent for now,” said Douglas Porter, chief economist at BMO Capital Markets.

“That’s likely enough to keep the Bank of Canada on hold for the foreseeable future.”

The services-producing sector — including transportation and warehousing, as well as healthcare and social assistance, public administration — accounted for many of the new jobs. Not surprisingly, natural resources jobs declined in October amid ongoing low crude prices. There were also fewer workers in construction and agriculture.

Given Canada’s expanding population, hitting the 18.02-million job mark was not unexpected. The growth in hiring tends to rise when the country’s economy edges up. In September, by comparison, total employment was 17.98 million.

Also anticipated, the Oct. 19 federal election provided a temporary lift to the monthly employment data — collected between Oct. 11 and 17 — as the overall number of public administration jobs increased by 32,000. The advance polls were open from Oct. 9 to 12.

“The increase was seen across all provinces and mostly in temporary work, coinciding with activities related to the recent federal election,” the federal agency noted.

Meanwhile, U.S. employment growth has been steady — up by 271,000 last month, the largest rise since December 2014, the U.S. Labor Department said Friday, accompanied by a drop in the jobless rate to five per cent from 5.1 per cent in September.

“The very strong jobs report south of the border . . . is arguably the more important number, and suggests that rate hikes in the U.S. are not far away,” said economist Leslie Preston, at TD Economics.

The U.S. Fed could raise its long-standing near-zero rate in December if growth in the economy and jobs continues to improve.


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