Canada’s economy added 40,000 jobs last month, about twice as many as expected, but also only about half as many as would be needed to keep up with population growth.
Statistics Canada reported Friday that while the economy added jobs, the country also added about 103,000 new people. So despite the mini-surge, the employment rate — the percentage of adults have a job, compared to the working-aged popultion — actually declined by 0.1 percentage points, to 61.9 per cent.
Economists had been expecting the economy to add only about 20,000 jobs, and a few were even calling for a decline, which would have been the second contraction in a row in the job market.
So far this year, Canada’s job market has added about 174,000 new positions, or on average about 25,000 new jobs per month.
But the number of working-age adults has gone up by about three times that, with Canada’s population gaining on average 83,000 people aged 15 or older every month.
Doug Porter, an economist with Bank of Montreal, says the steady stream of more than 800,000 new people who’ve come to Canada in the past year is the biggest single factor driving the job market right now.
“Canada now needs a steady flow of jobs just to match raging population growth,” he said. “Thus, it’s not inconsistent to see a sturdy monthly gain of 40,000 jobs and still conclude that the market is slightly easing.”
Speaking to a business audience in Calgary on Thursday, Bank of Canada Governor Tiff Macklem said the central bank has noted that even in months when the economy adds jobs, they’re not coming at a faster pace than population growth, which means they aren’t making their inflation fight harder.
“What that suggests is that the the supply of workers is growing more than the demand for workers,” Macklem said. “So supply is catching up with demand and those pressures are easing.”
