Despite job growth, employment rate dips as unemployment edges up
In February, the labor market experienced a mixed bag of results, with employment growing by 41,000, a 0.2 percent increase, which was overshadowed by population growth at a rate of 0.3 percent.
This disparity led to a slight dip in the employment rate, down 0.1 percentage points to 61.5 percent. Concurrently, the unemployment rate edged up by 0.1 percentage points, settling at 5.8 percent, effectively cancelling out the decrease seen in January.
A closer look at demographic trends revealed that employment among core-aged individuals, defined as those 25 to 54 years old, improved significantly, as reported by Statistics Canada.
Specifically, women in this age bracket saw an increase of 45,000 jobs, or 0.7 percent, and men experienced a growth of 23,000 jobs, or 0.3 percent. Conversely, the situation was less rosy for women aged 55 and older, who saw a decrease in employment by 29,000, translating to a 1.4 percent reduction.
The employment scenario also varied across provinces. Alberta and Nova Scotia witnessed employment hikes of 17,000 (0.7 percent) and 6,300 (1.2 percent) respectively. In contrast, Manitoba reported a decline of 5,300 jobs, a 0.7 percent decrease, while other provinces observed minimal changes.
The services-producing sector led the way in employment gains, with notable increases in accommodation and food services by 26,000 (2.4 percent) and professional, scientific, and technical services by 18,000 (0.9 percent).
However, not all industries fared well, as educational services and manufacturing experienced downturns.
The report further highlighted that total hours worked in February saw a minor uptick of 0.3 percent over the month and a 1.3 percent rise on a year-over-year basis. Additionally, average hourly wages for employees jumped by 5.0 percent year-over-year to $34.82, following a 5.3 percent increase in January.
An interesting aspect of February's employment data was the ongoing imbalance between employment and population growth rates.
Despite the addition of 41,000 jobs, which mirrored a similar increase in January, the continued decline in the employment rate underscored the challenges posed by rapid population expansion.
This trend was evidenced by the fifth consecutive monthly drop in the employment rate, marking the most prolonged period of consecutive decreases since the six-month period ending in April 2009.
In terms of demographics, core-aged women saw their employment rate rise by 0.3 percentage points to 81.4 percent in February, an indication of employment growth outpacing population growth. The employment rate for core-aged men remained stable at 87.2 percent.
The report also noted a slight increase in the unemployment rate for February, along with a steady labor force participation rate. The regional employment analysis underscored varying trends across provinces, with differences in unemployment rates becoming apparent.
The narrative also touched on the significant role of remote work in the current labor market landscape. As of February, 13.5 percent of workers usually worked exclusively from home, with an additional 11.4 percent engaging in hybrid work arrangements.
