Quebec: Canada’s newest jobs hotspot

Bloomberg

Quebec’s unemployment rate fell to the lowest on record last month while Alberta’s surged to a two-decade high, underlining the swing in Canada’s economic momentum through the recovery from an energy crash.
Joblessness in the mostly French-speaking province fell to 6.2 percent in November from 6.8 percent in October, and in Alberta it climbed to 9 percent. The national jobless rate declined to 6.8 percent from 7 percent, Statistics Canada said Friday from Ottawa.
“I’m stunned — it’s a banner year” for Quebec, said Sebastien Lavoie, assistant chief economist at Laurentian Bank Securities in Montreal. He linked good times to a construction boom in his hometown, a low dollar boosting service industries and business confidence aided by provincial government budget surpluses.
The movement of jobs from the western oil patch to central Canada’s service and factory hubs meshed with Bank of Canada Governor Stephen Poloz’s view that non-energy companies will help the world’s 10th largest economy recover over the next few years. Poloz said this week he would only cut his 0.5 percent benchmark interest rate if there was another shock like the oil crash.
“Quebec is within a whisker of posting the lowest unemployment rate in the country, something that we haven’t seen in the 40 years of available data,” said Doug Porter, chief economist at BMO Capital Markets in Toronto. The job report “strengthens the view that the Bank of Canada will be perfectly happy staying on the sidelines.”
Quebec is tied more to manufacturers like Canam Group Inc. and
Montreal-based software makers, who benefit from Canada’s weaker dollar and a growing US economy. South of the border, payrolls increased by 178,000 jobs, the Labor Department said, bringing the unemployment rate down to a nine-year low of 4.6 percent.
The province added 8,500 jobs in November and over the past 12 months the number of unemployed people has dropped by 17 percent.
Lavoie at Laurentian Bank said it would be “extremely surprising” for Quebec to make further major gains in the job market over the next year.
The figures have yet to reflect
some announced cutbacks at Bombardier Inc. that haven’t happened yet, and the US might be about to get tough on Quebec’s large softwood lumber industry.