- Employment rose 54,000 in September
- The unemployment rate fell 0.2 ppts to 5.5%
- Hourly wage growth surpassed 4% in Q3
There was no give-back after August’s strong jobs numbers as Canada recorded another above-50,000 employment gain in September (the fifth such increase in nine months this year). The labour force is growing at its fastest pace in more than a decade, helping sustain job growth late in the economic cycle. Wage growth, previously the missing link in a strong labour market backdrop, has picked up momentum this year and is running north of 4% per today’s data. A broader look at wages also suggests cycle-high growth. The combination of expanding employment and rising wages has provided some insulation for consumers, some of whom have faced higher debt servicing costs after rate hikes in 2017 and 2018.
Today’s data suggest the BoC doesn’t need to rush to undo those earlier rate hikes, even as other central banks are opting for additional accommodation. As Deputy Governor Schembri noted in September, a “solid starting point,” including a strong labour market, gives the economy welcome resilience to “possible negative economic developments.” Those developments are hard to ignore, though, with mounting signs of a slowdown in Europe and some concerning survey data out of the US. That could still make for a cautious tone from the BoC on October 30, even if the labour market continues to point to a resilient domestic economy.
