Employment growth on the West Coast made a slight recovery in April as the province added 2,100 jobs to the economy.
The unemployment rate, however, shot up 0.5 percentage points to five per cent – a sign of more people entering the workforce, according to Statistics Canada data released on Friday (May 5).
Educational services added 9,400 jobs, while the biggest losses were felt in the construction sector (-3,500 jobs) and information/culture/recreation (-10,600) – the latter of which is associated with the film and TV industry.
Meanwhile, Canada added another 41,000 jobs to the national economy as the unemployment rate remained static at five per cent.
That doubled the number of jobs economists expected to see added last month, according to CIBC senior economist Andrew Grantham.
“For now, labour markets look very firm and continued to surprise broadly on the upside in April,” RBC assistant chief economist Nathan Janzen said in a note, referring to the national data.
“But growth headwinds from aggressive interest rate hikes over the last year continue to build, with tightening credit conditions in the U.S. adding to downside risks.”
He said the Bank of Canada is likely done hiking interest rates, but labour markets are too strong and inflation is still running too hot to justify a quick shift to cuts.
“We expect the BoC to remain on hold for the rest of this year,” Janzen said.
TD senior economist James Orlando echoed those sentiments, saying in a note he does not expect the central bank to touch interest rates for the time being.
“The fact that the unemployment rate has been stable means that we may have reached a new steady state,” he said. “This means that the 'surprise' employment report isn't adding the same labour market tightness as it would have
in the past.”
