Published: Mon, May 13, 2019
Markets | By Otis Pena

Canada adds record 106500 jobs in April, unemployment rate dips

Canada adds record 106500 jobs in April, unemployment rate dips

The Canadian economy added 106,500 jobs in April, the biggest monthly gain on record, led by employment increases in the two most populous provinces, Ontario and Quebec, Statistics Canada data showed on Friday. The number of people in the labour force jumped by 108,100 in April, also a one-month record, on a surge in youth participation.

Canada's unemployment rate dropped to 5.7 percent in April, in line with the rise in job-creation, compared to a 5.8 percent jobless rate the previous month.

Nevertheless, the jobs report adds an exclamation point to other strong data this week - on trade and on housing starts - that indicate the Canadian economy has revved up after an unusually harsh winter that further weighed on already weak growth. That should still leave the Bank of Canada with plenty of flexibility to hold off on interest rate hikes any time soon.

The Canadian dollar rallied on the back of the jobs report to 1.3400 against the USA dollar.

Today's employment figures - which also exceed the forecasts of economists - come as the Bank of Canada recently predicted slow economic growth in 2019, with a lingering soft patch before the country's economy is expected to heat up in the second half of the year.

"It seems like there's a little more strength left in the Canadian economy", Brian DePratto, a senior economist at Toronto Dominion Bank, said in a telephone interview.

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Total hours worked also picked up, increasing by 1.3 per cent annually in April, from 0.9 per cent in March.

However, the strong labour market could boost consumer demand and the nation's services sector, which could prevent a recession. Hourly wage growth also accelerated to 2.5 per cent year over year, an eight-month high and the fifth straight increase. Most of the gains were full-time, up 73,000, and in the private sector.

"We're drawing in people, and that tells you how tight the labour market is, " Tony Stillo of Oxford Economics said.

Canada has added 426,400 jobs over the past 12 months, the largest one-year increase since 2007 and up 2.3 per cent over that period.

Overall employment dropped by 7,200 net jobs in March, the first monthly decrease after six consecutive months of rising employment between September and February.

Employment had increased in Ontario, Quebec, Alberta, and Prince Edward Island, while a decline in New Brunswick was observed.

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