Canada has experienced its lowest rate of unemployment in nearly a decade due to a huge boost in job creation in November, according to Statistics Canada. Last month, 79,500 new jobs were generated, driving the jobless rate down 0.4 percent to 5.9 percent.
The unemployment rate hasn’t been this low since 2008 prior to the worldwide financial crisis. It’s the country’s 12th consecutive month of job creation and its best 12-month achievement in a decade.
“The employment figures for November smashed expectation,” CIBC Economist Nick Exarhos told clients.
This development happened despite a slowing economy, noted BMO Capital Markets senior economist and director Sal Guatieri, who wrote in a note to clients: “Defying the recent slowing in the economy after a stellar year, Canadian businesses are on a hiring splurge.”
The news may prompt the Bank of Canada to move forward with a rate hike, BNN reports. Guatieri added, “The stellar jobs report should allow for a more two-way discussion about Bank of Canada policy, as, until now, the debate was largely about how much longer the bank would delay the next rate hike. The bank must be getting antsy about the continued tightening in labour markets and brewing wage pressures.”
“After a hot start to the year, GDP growth was expected to slow, so this morning’s report was not a surprise. Further, after years of weak investment, it seems firms are finally confident enough to pull the trigger on spending,” said Pedro Antunes, deputy chief economist at The Conference Board of Canada.
“While consumption is expected to weaken as consumers battle higher debt loads, the strong labour market is supportive of continued, albeit softer, spending growth. With unemployment reaching its lowest rate since 2008 and wage growth accelerating, we continue to expect a gradual tightening in monetary policy from the Bank of Canada.”
Economists predicted the addition of just 10,000 jobs in November with an unemployment rate of 6.2 percent.
In the year leading up to November, employment increased 2.1 percent. There has been a total of 390,000 net jobs, most of which were full-time positions.
Employment numbers increased in Ontario, British Colombia, and Prince Edward Island. They dropped in New Brunswick and stayed steady in other provinces, reports Staffing Industry Analysts.
Industries such as wholesale and retail trade, manufacturing, educational services and construction saw bumps in employment, while the number of agriculture jobs dropped.