Canada sees record job gains in April as economy heats up

Bloomberg

Canada’s economy posted record job gains in April, along with a pick-up in wages, in the strongest sign yet the nation’s economy has emerged from a soft patch.
Employment rose by 106,500 in April, Statistics Canada said in Ottawa, the biggest one-month increase in data going back to 1976. Economists had forecast employers would add about 12,000 positions. The country’s jobless rate dropped to 5.7 percent, and is hovering near four-decade lows.
The report reaffirms just how much the labour market has been the main driver of Canada’s expansion, and adds to a recent run of other data showing clear signs Canada is on the path back to growth after the economy stalled for much of the past six months. “The details are unambiguously strong across the board: strong full and part-time growth, solid wage growth, increasing participation, and another decline in the unemployment rate,” said Brett House, deputy chief economist at Scotiabank.
Canada’s economy has added 426,400 jobs over the past 12 months, the largest one-year increase since 2007 and up 2.3 percent over that time. Over the past two years, the economy has added 700,000 jobs.
“It seems like there’s a little more strength left in the Canadian economy,” Brian DePratto, a senior economist at Toronto Dominion Bank, said in a telephone interview.
The labour market had been a lone bright spot for in an economy struggling in recent months with a sharp slowdown on the back of weakness in the oil sector, and was the only thing giving policy makers much comfort. It’s a key reason why the Bank of Canada is sticking to its belief the economy will
rebound later this year.
The gains were broad-based — across industries, regions and demographics — and there were hardly any weaknesses in the report. Most of the gains were full-time, up 73,000, and in the private sector. Both goods-producing and services
sectors recorded gains.
Even wages — which have been sluggish of late — are showing signs of life. Annual hourly wage gains accelerated to 2.5 percent in April, the fastest annual gain since September, up from 2.4 percent in March. Pay gains for permanent employees rose to 2.6 percent, the strongest increase since August.
Total hours worked also picked up, increasing by 1.3 percent annually in April, from 0.9 percent in March.
The jobs increases have largely reflected higher labor force numbers as the economy pulls in new workers — youth and immigrants in particular — rather than falling unemployment. The number of people in the labour force jumped by 108,100 in April, also a one-month record, on a surge in youth participation.