Canada’s latest employment report might look like good news at first glance but dig a little deeper, and the story isn’t as rosy as it seems.
According to Statistics Canada’s November 7 report, the country added 67,000 jobs in October, bringing the unemployment rate down to 6.9 percent. On the surface, that sounds like a healthy rebound especially after a sluggish summer. But most of those new positions were part-time, while full-time employment actually fell by 18,500. In other words, more Canadians are working, but not necessarily in the kinds of jobs that pay the bills or provide long-term security.
BMO’s chief economist Douglas Porter noted that the back-to-back job gains in September and October helped erase the “nasty two-month decline” seen in July and August. Still, even he admitted that the quality of jobs leaves much to be desired. As he put it, “all the net new jobs were part-time,” and the gains were concentrated in just a few sectors.
Ontario, for instance, carried much of the weight adding 54,500 jobs but Porter even credited part of that spike to something as fleeting as the Toronto Blue Jays’ playoff run. That’s hardly the foundation of sustained growth.
Scotiabank’s Derek Holt and TD’s Leslie Preston both offered a similar dose of realism. Holt cautioned that the 67,000-job bump could easily fall within the Labour Force Survey’s margin of error, meaning it may not represent a true gain at all. He also pointed out that most of the growth came from lower-paying, part-time roles what he called “fairly low-quality” jobs. Preston added that while the data show “some resilience,” there’s little sign of real strength. The job market, she said, “remains soft.”
Sector-wise, the picture is uneven. The wholesale and retail trade sector led the way with 41,000 new jobs, followed by transportation and warehousing with 30,000 and information, culture, and recreation with 25,000. But manufacturing barely inched forward gaining only 8,700 jobs and construction actually shed 15,000 positions. Since January, goods-producing industries have lost 54,000 jobs overall, while the service sector has added 142,000. It’s clear which side of the economy is carrying the load, and it’s not the one that builds lasting economic stability.
There was at least one bright spot: youth employment. After months of grim figures, young workers finally saw an uptick of 21,000 jobs in October, nudging the youth unemployment rate down to 14.1 percent. But again, without knowing how many of these roles are part-time or seasonal, it’s hard to call it a true turnaround.
Meanwhile, wages are on the rise up 3.5 percent year over year to an average of $37.06 an hour. Holt warned, however, that this “super-acceleration” in pay, paired with poor productivity, could fuel inflationary pressure.
That’s a problem the Bank of Canada will be watching closely as it heads toward its final interest rate decision of the year on December 10. With the benchmark rate sitting at 2.25 percent after two consecutive cuts, Governor Tiff Macklem has hinted that the bank may hold steady unless economic data throw a surprise.
All told, Canada’s October jobs report is a classic case of numbers that flatter to deceive. Employment is technically up, but the gains are fragile fueled by part-time, lower-wage work and narrow sectoral boosts. For now, the job market looks less like a comeback and more like a careful balancing act between appearances and reality.
