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And the winners are… manufacturing and public-sector jobs

A roundup on expert analysis on the April jobs report


 

To recap:

  • The economy added some 12,500 jobs in April, roughly in line with expectations. The uptick in employment comes after a steep 54,500 dip in March.
  • The gains were just enough to keep the unemployment rate steady at 7.2 per cent.
  • Beyond the headline numbers, the details of the report were more positive. The job gains, for example, were mostly in full-time work.
  • Also, manufacturing churned out some 20,600 new positions, the largest increase since May 2012. In general, the goods-producing industries delivered a strong performance, with 24,500 jobs added, whereas the service sector shed 12,000.
  • Surprisingly, it was the public sector that lead the overall employment increase, with gains in public administration and health care.
  • Provincially, employment rose in Alberta, declined in Manitoba, New Brunswick and Newfoundland and Labrador, and remained roughly unchanged in Ontario and Quebec.

What the analysts are saying:

  • “Sometimes the Canadian jobs numbers don’t deliver a radical surprise” quipped CIBC’s Avery Shenfeld. Labour market movements have been puzzling analysts recently, posting outsized gains late last year, when the economy was slowing to a crawl, and then steep declines in the first quarter of this year, when GDP, by contrast, grew at a faster pace.
  • April could be the beginning of an upward trend in which the labour market recoups the 25,700-some jobs it shed in the first three months of the year, wrote RBC’s Dawn Desjardins. The trend would be in line with a stronger than expected first-quarter GDP growth, which the bank expects to come in at 2.3 per cent annualized vs. the Bank of Canada’s latest forecast of 1.5 per cent.
  • A monthly gain of between 10,000 and 15,000 jobs is consistent with the Canadian economy proceeding at its “natural cruising speed,” noted TD’s Francis Fong. However, the April report still contains detail that isn’t quite aligned with broader economic trends: construction jobs, for example, are still on the rise even though housing starts have pulled back; ditto for rising public administration jobs, which don’t fit with the current mandate of fiscal restraint at every level of government. Expect jobs to shift between sectors in the coming months, says the bank.

 
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