Canadian wage growth hits fastest pace since 2009, but economy sheds jobs

The increase in wages marked the indicator’s strongest month in a decade

Wage growth accelerated last month to its fastest clip in more than decade, according to numbers released Friday from Statistics Canada.

The 4.5 per cent burst came in a month that also produced less-positive data: the unemployment rate moved up to 5.7 per cent as Canada shed 24,200 jobs.

The increase in wages — as measured by year-over-year average hourly wage growth for all employees — marked the indicator’s strongest month since January 2009.

The reading, one of several wage measures closely watched by the Bank of Canada, was up from 3.8 per cent in June and 2.8 per cent in May. In Quebec, wage growth sped up to nearly 6.2 per cent, while Ontario’s number was 5.1 per cent.

In terms of job creation, the economy saw its weakest three-month stretch since early 2018. Until the spring pause, Canada had a been on a healthy run of monthly employment gains since last summer.

The survey found the numbers were nearly flat between May and July, a period that saw Canada add an average of 400 jobs per month. The agency cautions, however, that the recent monthly readings have been small enough that they’re within the margin of error and, therefore, statistically insignificant.

READ MORE: Canada’s GDP grows 0.2 per cent in May as manufacturing rebounds: Statcan

Even with the July decline, compared to a year earlier, the numbers show Canada added 353,000 new positions — almost all of which were full time — for an encouraging overall increase of 1.9 per cent.

The July unemployment rate remained near historic lows even after edging up to 5.7 per cent from 5.5 per cent in June. The rate was 5.4 per cent in May, which was its lowest mark since 1976.

Stephen Brown, senior Canada economist for Capital Economics, said the wage data released Friday — along with other recent wage indicators — suggest the measures are finally catching up to the tightened job market.

Brown predicts that even with solid wage numbers at home, the Bank of Canada will likely have to address something much bigger in the coming months: the weakening global economic environment.

“You’re now seeing this strong labour market in terms of the wage numbers, but we know conditions elsewhere in the world are deteriorating — so it’s certainly something interesting for the policy-makers to think about,” he said in an interview.

Capital Economics, Brown added, is among a minority of forecasting shops that predicts the Bank of Canada will cut interest rates in October to respond to fallout from an escalation in ongoing trade wars and weakening demand from the United States.

TD senior economist Brian DePratto wrote in a report Friday to clients that “the Bank of Canada remains caught between two opposing trends: relatively healthy domestic conditions, and a worsening external backdrop.”

He added that unless we see a marked shift in either of these, the central bank will “likely remain happy to sit on the sidelines.”

A closer look at July’s jobs numbers shows the economy lost 69,300 private-sector employee positions last month, while the public sector gained 17,500 jobs.

Alberta, Nova Scotia and New Brunswick posted notable declines in employment last month — and jobless rates moved higher in each of the provinces.

Quebec and Prince Edward Island added jobs last month, the report said.

Youth employment fell by about 19,000 positions, pushing the jobless rate up 0.7 percentage points to 11.4 per cent.

The number of positions for core-aged women — between 25 and 54 years old — dropped by about 18,000.

Andy Blatchford, The Canadian Press

Like us on Facebook and follow us on Twitter.

Just Posted

UVic announces review into circumstances of fatal bus crash

Upcoming student trip on the same route not cancelled

Hundreds gather at fundraising kickoff for ‘Kings Park’ purchase

Campaign to raise $2.75 million for the District of Saanich underway

Collector car season rolling to season’s end at Turkey Head

European car and coffee meet is every third Sunday

Saanich police injured while arresting suspect

Man accused of shoplifting pulls out a knife, struggles with arresting officers

Oak Bay grants 60 days of protection for century-old mansion

J.W. Morris House slated for removal by Abstract Developments

Third instance of Trudeau in skin-darkening makeup emerges

Another instance of Trudeau using makeup to darken his face has emerged, within 24 hours of the first

Crime Stoppers most wanted for Greater Victoria for the week of September 17

Greater Victoria Crime Stoppers is seeking the public’s help in locating the… Continue reading

POLL: Should the province step in to upgrade the road to Bamfield?

The death of two University of Victoria students on a bus bound… Continue reading

Yearbook photo surfaces of Trudeau wearing ‘brownface’ costume in 2001

The report describes the occasion as an ‘Arabian Nights’-themed gala event

‘Troubling, insulting’: NDP Leader Jagmeet Singh reacts to Trudeau’s brownface photo

Jagmeet Singh, leader of the New Democrats, responded with a call for love after Trudeau photos surface

Elderly B.C. man gets 10 years in prison for sexually abusing young daughters

WARNING: This story contains graphic details and is not appropriate for all readers

‘This is not a drill’: Whistler Blackcomb gets first snowfall of the season

The 7th Heaven Summit had a dusting of snow Tuesday morning

Legislature gifts, clothing, travel need better control, B.C. auditor says

Audit follows suspensions of managers by Speaker Darryl Plecas

Most Read