CANADA: According to the Labour Force Survey (LFS), employment jumped 48K in January, easily topping consensus which was looking for a decline of 10K. As a result, the jobless rate dropped one tick at 6.8% with the participation rate rising to 65.9% from 65.8%. The surge in January employment was mostly due to paid jobs (+40K) while self-employment registered an 8K rise. Paid employment gains were tilted to the private sector (+32K) while government (+8K) also posted a gain. The goods sector added just 6K jobs as gains in construction, agriculture and resources offset declines in manufacturing and utilities. Services sector employment jumped 43K with strength in several sectors. Part-time employment soared 32K, while full-time employment rose 16K. Total hours worked fell 0.6%, following a decline of 0.7% in December. Over the last six months the labour market, mostly driven by the services sector, has generated a massive 239K jobs. This was the strongest performance in 15 years. That being said, those gains have been tilted towards part-timers and hours worked have continued to decline. In other words, Canadian employers lately increased their headcount massively but their employees are working less intensively.
The merchandise trade balance recorded a surplus of C$0.9 billion in December, down slightly from an upwardly revised C$1 billion in November. The deterioration was due to nominal imports (+1%) growing faster than exports (+0.8%). Energy exports surged 15.9% solely on higher prices (volumes actually decreased) while imports fell sharply. As a result, the energy trade surplus jump to C$6.4 billion, its highest level since 2014. However, the non-energy trade deficit widened to C$5.4 billion. Overall export volumes were down following declines in several categories, including motor vehicles and parts. These more than offset gains in the aerospace section, which were boosted by deliveries of Bombardier’s C-series aircraft. In real terms, Canada’s exports retreated 1% while imports advanced 1.6%.
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