Jobless rate falls to 6.5%, but wages stall

OTTAWA — The unemployment rate fell last month to its lowest level since the start of the last major recession, but details within Statistics Canada’s latest labour report — including a record-low for wage growth — dampened what has otherwise been a strong run for the job market.

Job creation cooled down in April and produced a net increase of just 3,200 positions, a figure so low it was statistically insignificant, the agency’s workforce survey said Friday.

However, Canada managed to hang on to the job gains from the unusually long streak of past months — and over the last year more than two-thirds of the labour-market growth has been full time, said RBC senior economist Nathan Janzen.

Year-over-year workforce participation is up and Janzen noted that April’s 6.5 per cent jobless rate — which dropped from 6.7 per cent in March — is now below its 10-year, pre-recession average level.

The unemployment rate was lower last month than it had been since October 2008 and 0.6 percentage points lower compared to a year earlier, as fewer youth searched for work.

Janzen, however, highlighted in his research note to clients that there was a “fly in the ointment”: April’s historically feeble wage growth.

“On that one, it’s just puzzling,” Janzen said in an interview.

“Typically, you would say we actually have relatively tight labour markets, but it’s just not generating wage growth. So, I think that wage measure is the main one that’s going to keep giving the Bank of Canada pause, and it gives us pause as well.”

Hourly wages for all employees expanded by 0.7 per cent in April, the slowest year-over-year growth since the federal agency started collecting that data in January 1997. For all permanent employees, wages expanded compared to a year ago by just 0.5 per cent — also an all-time low.

Janzen said wage growth is an important indicator, particularly for the Bank of Canada as it mulls interest-rate decisions. The data points to households’ purchasing power and the health of their monthly income statements.

Jimmy Jean, a senior economist for Desjardins, called the wages result ”dreadful” in his research note Friday. Jean added that wage growth even managed to stay above two per cent during the 2008-09 recession.

“The (Bank of Canada) can be expected to use anaemic wage growth to further downplay the unemployment rate’s decline and claim proof of ‘material excess slack’ still being prevalent in the labour market,” Jean wrote.

A consensus of economists had expected the unemployment rate to stay at 6.7 per cent, according to Thomson Reuters.

Compared to a year earlier, the data showed that Canada added 275,700 jobs, 189,600 of which were full-time positions.

A closer look at Friday’s data showed a loss of 50,500 positions in the more-desirable private-sector category, while the public sector added 35,200 jobs. There were also 31,200 fewer full-time jobs last month, while the number of part-time positions grew by 34,300.

The youth unemployment rate slipped 1.1 percentage points to 11.7 per cent last month with help from a 0.5-percentage-point drop in the youth participation rate.

Just Posted

WATCH: From humble beginnings Red Deer-based wrestling promotion is growing

It wasn’t that long ago that Dylon Featherstone and the Canadian Wrestling… Continue reading

WATCH: Families make yo-yos and weaved yarn at Red Deer Museum and Art Gallery

It was all about making yo-yos and yarn bombing at Red Deer… Continue reading

Solve mysteries with Sherlock Holmes and Dr. Watson in Red Deer

At three sold-out one act Sherlock Holmes plays in Red Deer, theatre… Continue reading

Quebec man arrested in slaying of Alberta woman 16 years ago

AIRDRIE, Alta. — A Quebec man has been arrested in the slaying… Continue reading

Construction underway at Medicine River Wildlife Centre in Red Deer

The new building is twice the size of the old one

WATCH Replay Red Deer Feb. 18: Your weekly news highlights

Watch news from Red Deer and Central Alberta

How to keep local news visible in your Facebook feed

Facebook has changed the news feed to emphasize personal connections. You might see less news.

Liberals looking at creating use-it-or-lose-it leave for fathers, Trudeau says

OTTAWA — Prime Minister Justin Trudeau is raising the idea of creating… Continue reading

Trump gets angry about election meddling, but not at Russia

‘Weirdest thing’: Trump expresses anger, but not over Russian election-meddling

New doping charge could hurt Russia’s chance at reinstatement

Russia could lose its chance to be reinstated before the end of the Winter Olympics because of a doping charge against curling bronze medallist Alexander Krushelnitsky.

#Metoo movement causing confusion in many men, fear of missteps with women: experts

Being painted by the same sweeping brush as those alleged to have mistreated women has angered men

Virtue and Moir break their own world record

Virtue and Moir break short dance record to sit first in ice dance at Olympics

Calgary man dies in Mexico following sudden illness

Troy Black was with his wife, Lindsay, in Puerto Vallarta when he began vomiting blood on Thursday

Life or death main decision for school shooting suspect

FORT LAUDERDALE, Fla. — The evidence against the Florida school shooting suspect… Continue reading

Most Read


Five-day delivery plus unlimited digital access for $185 for 260 issues (must live in delivery area to qualify) Unlimited Digital Access 99 cents for the first four weeks and then only $15 per month Five-day delivery plus unlimited digital access for $15 a month