Canadian Employment Surges In March

Total employment surged in March (+82.3K) following a decrease of 2.8K jobs in February. Strong gains were observed in full-time jobs (+70.0K) while parttime jobs posted also an increase of 12.4K. The goods-producing sector increased 24.9K, following an increase of 17.8K the previous month. Within the goods-producing sector, manufacturing (+11.8K) and construction (+6.4K) were the top performers.

The services-producing sector surged this month (57.5K). Among the services-producing sector, health care & social assistance (+31.5K) was the top performer while educational services (-24.6K) lagged. At the provincial level, five provinces posted an increase in employment. Ontario’s (+46.1K) and Quebec’s (36.4K) experienced the largest gains while New Brunswick (- 5.7K) lagged. The unemployment rate decreased to 7.2% from 7.4% a month before.

Opinion

While LFS data on the Canadian labor market have been somewhat disturbing in recent months, March data are clearly reassuring. We mentioned several times that the overall economic picture was not consistent with the negative message sent by recent LFS surveys. This morning’s report comforts us in this position. Aside from the strong headline 82K print, the details are even better.

Jobs created are mostly full-time and coming from the private sector. As a result, both indicators reached new all-time highs in March (top chart). Also note that regions and groups particularly hit in the recent months are benefiting the most off March gains. Quebec’s data which indicated the appearance of a recession lately rebounded with its second strongest gain since 1976 (middle chart).

After stagnating for several months, Ontario’s employment also rebounded strongly. We are also particularly pleased to see a substantial drop in the youth unemployment rate which is now at its lowest in 10 months (bottom chart) and one of the best in the OECD. This morning’s job report is consistent with a scenario that will see the Bank of Canada upgrade its growth forecast in its upcoming Monetary Policy Report (April 18).