February’s Labour Force Survey results just released by Statistics Canada record a big gain in employment of +259,000 jobs and an improvement in the ‘headline’ seasonally adjusted (SA) unemployment rate to 8.2% from 9.4% in January.

Canada’s not seasonally adjusted (NSA) ‘R-3’ unemployment rate eased down to 7.3% in the latest month from 8.2% in the prior month. ‘R-3’ adopts the same strict methodology utilized in the U.S. It takes a tougher stance on who is out of work and ‘honest-to-goodness’ looking to be rehired. Therefore, R-3 is an ‘apples-to-apples’ comparison with the 6.6% NSA unemployment rate in America.

Canada’s jobs claw-back ratio, versus the big drop in employment that occurred in the Spring of last year, as the coronavirus contagion forced economywide shutdowns, has improved to a not-so-bad 80.0%. At four-fifths, it’s certainly better than the barely half (53.8%) jobs recovery rate in the U.S.

Neither Canadian construction nor manufacturing, however, managed major hiring advances in the latest month. Manufacturing added just +8,000 jobs and construction, a less than sparkling +6,000.

Graph 1: Canada: Month-to-month Total Employment Change

Canadian total employment in Feb 2021 was +1.4% month to month and -3.1% year over year.

Latest data point is for February, 2021.

Data sources: Household Survey, Statistics Canada.
Table: ConstructConnect.

Graph 2: Canada ‘R-3’ Unemployment Rate vs U.S. Unemployment Rate
Not Seasonally Adjusted (NSA) Data (Statistics Canada calculates ‘R-3’ on same basis as U.S. rate)

Canadian total employment in Feb 2021 was +1.4% month to month and -3.1% year over year.

Latest data points are for February, 2021.

Data sources (seasonally adjusted): Statistics Canada and U.S. Bureau of Labor Statistics (Department of Labor).
Table: ConstructConnect.

Table 1: U.S. and Canadian Jobs Markets – February 2021

In February, the U.S. total jobs count rose by +379,000. Canada's job count also rose, by +259,000.

SA is seasonally adjusted / NSA is not seasonally adjusted.
U.S. labor data is from a ‘payroll survey’ / Canadian labour data is from a ‘household survey’.
Canadian NSA unemployment rate ‘R3’ is adjusted to U.S. concepts (i.e., it adopts U.S. equivalent methodology).

Data sources: U.S. Bureau of Labor Statistics (BLS) & Statistics Canada.
Table: ConstructConnect.

Ontario’s Labor Market a Sore Spot

Among provinces, the three best for relatively low unemployment rates in February were Quebec (6.4%), Manitoba (6.8%), and British Columbia (6.9%). Unemployment rates in Ontario and Alberta remained elevated at 9.2% and 9.9% respectively.

There are still no provinces with year-over-year gains in employment. Coming closest are Nova Scotia (-0.4%) and B.C. (-0.6%).

Recently, coronavirus case counts suddenly reared up in Newfoundland and Labrador coincident with deteriorating labor market conditions. But there’s better news on the horizon with the pickup in the global price of oil. Offshore crude is one of the province’s chief export products.

Graph 3: Canada’s Provincial Labour Markets – February 2021

Three provinces are in the top portions (i.e., above Canada) in both graphs: Manitoba, British Columbia and Nova Scotia. Currently struggling with the worst labour markets are Newfoundland/Labrador and Prince Edward Island.

Data Source: Statistics Canada.
Chart: ConstructConnect.

Not To Be Sneezed at Wage Gains

As in the U.S., there are some sizable year-over-year compensation increases occurring in Canada. Average hourly earnings for all employees in February were +4.8% and average weekly earnings, +5.0%.

Statistics Canada separates ‘all’ employees into union and non-union. For the former, the compensation climbs in the latest month were +2.2% both hourly and weekly; for the latter, +5.9% hourly and +6.2% weekly.

The importance of earnings increases relates to how they may rev up inflation, but that’s something that will play out over a longer time frame, say six months to a year from now.

Graph 4: Change in Total Employment – Canada vs U.S.

The total jobs count in the U.S. in Februay 2021 was +379,000 (SA) m/m; Canada's comparable figure was +259,000 m/m.

Latest data points are for February, 2021.
‘Y/Y’ is current month/same month previous year; ‘m/m’ is current month vs prior month.

Data sources (seasonally adjusted): Statistics Canada and U.S. Bureau of Labor Statistics (Department of Labor).
Table: ConstructConnect.


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