At first glance, StatCan’s Labour Market survey from August paints a pretty rosy picture: Canada’s economy created 59,000 new jobs, and unemployment dropped 0.1 percentage point to 7.1%. But a more detailed look reveals some less encouraging details.
Until the beginning of this year, unemployment had been declining slowly. After peaking at 8.7% in August 2009, it dropped gradually to 7% in January this year. This year, however, the trend seems to have stopped. Although the economy has continued to create jobs, it has done so at a slower pace than in the past. Over the six months to August, employment gains averaged 12,000 per month, as opposed to 29,000 during the preceding six-month period. As a result, unemployment is now at the levels from December 2012.
In addition, almost all of the jobs created in August were part-time. And most of them went to only one segment of the job market: Women aged 55+. In fact, employment has grown significantly only for workers aged 55+ over the past year: Of the 246,000 jobs that Canada’s economy has created since August 2012, the majority (146,000) have gone to workers in this age group.
On the other end of the spectrum, young workers continue to struggle to land their first job. The unemployment rate for those aged 15 to 24 still stands at 14.1%. The vast majority of new jobs created in this age group are part-time. Employment growth for people aged 25 to 54 has not been very impressive either: It has grown by 0.5% in the past year.
It is interesting, however, that provincial employment trends have been somewhat unusual this year. Unemployment has actually dropped in most of Canada’s provinces, with 2 notable exceptions: Alberta and Quebec. In Alberta in particular, the number of jobs has actually increased slightly, but the number of those willing and able to work has increased even more. The oil industry accounts for a significant portion of Alberta’s jobs. Flat commodity prices may have prevented Alberta’s employers from hiring more workers.
Where the job market goes from here is anyone’s guess. One thing is, however, looks pretty certain: Given the lackluster collective performance of the world’s economies, a strong employment growth is highly unlikely in the next few months.