By Gordon Isfeld
OTTAWA (MaceNews) – Canada’s economy continued to churn out jobs in June, although at a weaker pace than most previous months, while the unemployment rate edged up to 5.5% as more people were looking for work, Statistics Canada said Friday.
The jobless rate had been lower in May, at 5.4%, but that followed a string of higher unemployment levels in the past year – topping out at 5.8% in September 2018 and again in January through March of this year before continuing and easing trend through March, the federal data agency said.
Many analysts had expected 10,000 jobs to be added in the monthly survey. Instead, the economy lost 2,200 positions in June.
The federal agency’s monthly Labor Force Survey (LFS) can often be erratic, swinging from gains to losses, but over a period of monthly reports the numbers can still provide a trend in job growth – sometimes a surprisingly strong pattern, as was the case in May.
“After a string of stellar economic releases in recent weeks, June jobs couldn’t extend the streak,” said Douglas Porter, chief economist at BMO Capital Markets.
“However, it doesn’t take much digging below the surface to find signs of underlying strength. “He said “perhaps the most noteworthy aspect” of the report was the massive rise in wages.”
While the LFS of wage measures “is not considered very reliable – it has huge swings – we’ll be closely watching to see if the trend is echoed elsewhere,” Porter added.
“For the Bank of Canada, the strength in wages and hours, and a still-low jobless rate will give them no reason to seriously consider matching Fed rate cuts anytime soon.”
The Bank of Canada has been closely watching the labor survey data as monetary policy officials approach their next interest-rate decision on July 10.
The key lending rate has remained at 1.75% since October 2018.
Along with the rate level decision, the central bank will release its quarterly Monetary Policy Report – a closely watched assessment of domestic and international economic trends.