The Canadian economy added 108,000 jobs in October, about 10 times what was expected, but even an unexpectedly hot job market isn’t doing much to lower the cost of living for Canadians.
Statistics Canada reported Friday that nearly every part of the economy added jobs last month, including the manufacturing, construction, housing and food services industries.
The increase in hiring was more than enough to make up for the jobs lost between May and September of this year. Virtually all net new jobs were full-time and nearly three-quarters came from the private sector. This is the first time this has happened since March.
Despite the surge, the unemployment rate in Canada remained stable at 5.2%. “But that was because more Canadians were looking for work,” TD Bank economist Rishi Sondhi said of the data. “[That’s] a healthy sign of growth “.
Wage earnings also picked up the pace, with median hourly earnings reaching $ 31.94 during the month. It increased by 5.6% over the previous year.
While wage increases are good news for workers, they are a double-edged sword for the Bank of Canada, which is trying to subdue inflation. Higher incomes will add to the inflationary pressure on spending, possibly forcing the central bank to raise interest rates even more than they already have.
“Up to this point, wages weren’t particularly worrying in Canada,” economist Royce Mendes said with Desjardins. “But the more this measure heats up, the greater the pressure will be on the Bank of Canada to continue its rate hike cycle for longer than previously anticipated.”
‘Everything is going up’
Despite these gains, more and more families report having difficulty keeping their heads above the water.
More than a third of households reported “difficulty meeting financial needs” during the month. Two years ago, only one in five said that.
Charlene Comeau, of Winnipeg, is one of them. She and her husband of hers both have full-time jobs to support their family of five, but she is looking for a second job to help pay the bills.
“At this point, I feel like I have to find another job … part-time, just to ease the pressure a little bit,” he told CBC News in an interview.
His employer tends to grant increases once a year, and although he has one this year, he said it wasn’t enough to make up for the huge price hike for things like food, gasoline, and keeping a roof over his head. of the family.
“We work – and my husband and I think we’re safe – but the way everything is going … we feel we need to do more.”
Two-thirds of people earning $ 40 an hour reported having received a raise in the past year. This compares to about half of those earning $ 20 or less.
This suggests a labor market moving in two different directions, said economist Tu Nguyen, with consulting firm RSM Canada.
“People with lower incomes, who struggle more, don’t get the earnings they need, while those who perhaps have a little more buffer to absorb higher inflation and higher prices continue to receive increases. “he said in an interview.
“When individuals and families who earn more earn more, go out and spend more and that increases the demand for goods and services, so inflation continues to stay high,” he said.