Canada adds 41,000 jobs in April, but all in part-time work

Employment rose by 41,000 (+0.2 per cent) in April, all in part-time work and the unemployment rate was 5.0 per cent, unchanged since December 2022, reported Statistics Canada on Friday.

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The federal agency said employment increased by 18,000 (+0.3 per cent) among core-aged men (25 to 54 years old) and by 16,000 (+0.7 per cent) among men aged 55 and older. Employment held steady for core-aged and older women. There was little change in female and male youth employment in the month.

Employment increased in wholesale and retail trade (+24,000; +0.8 per cent); transportation and warehousing (+17,000; +1.6 per cent); information, culture and recreation (+16,000; +1.9 per cent); as well as in educational services (+15,000; +1.0 per cent). Employment decreased in business, building and other support services (-14,000; -1.9 per cent). Employment rose in Ontario (+33,000; +0.4 per cent) and Prince Edward Island (+2,200; +2.5 per cent) in April, while it declined in Manitoba (-4,000; -0.6 per cent). There was little change in the other provinces, said the report.

“Since February, monthly employment growth has averaged 33,000, following cumulative increases of 219,000 in December 2022 and January 2023. The employment rate—the share of the population aged 15 and older who are employed—held steady at 62.4 per cent for the third consecutive month in April,” said StatsCan.

“Part-time employment increased by 48,000 (+1.3 per cent) in April, while full-time employment held steady. This was the first notable increase in part-time work since October 2022. In April 2023, 18.1 per cent of those employed were working part time, down slightly from a year earlier (18.7 per cent). Of those who worked part-time, 15.2 per cent did so involuntarily, meaning they would have preferred a full-time position. This rate was virtually unchanged from April 2022 (15.3 per cent).”

Statistics Canada said has remained near the record low of 4.9 per cent observed in June and July 2022. Compared with April 2022, the unemployment rate was down 0.3 percentage points in April 2023.

“The number of unemployed persons stood at 1.1 million in April, and the majority had been unemployed for 13 weeks or less (64.3 per cent). The proportion who had been unemployed for 27 weeks or more—the long-term unemployed—was 15.4 per cent, down from 19.5 per cent a year earlier, and in line with the pre-pandemic proportion of 15.3 per cent in February 2020,” added the report.

Andrew Grantham, an economist with CIBC Economics, said the Canadian labour market remained strong in April, with employment rising more than expected, the unemployment rate remaining near all time lows and wage inflation failing to decelerate.

“The 41K gain in jobs during April was double the 20K expected by the consensus, although the quality wasn’t quite as good as in prior months with all of the gain coming in part-time work (+48K) . . . The unemployment rate once again held firm at 5.0 per cent, as employment growth broadly kept pace with that of the labour force. Meanwhile wage growth was unchanged at 5.2 per cent, which was unchanged from the prior month and well above the 4.8 per cent expected by the consensus. Overall, even though today’s increase in employment was fairly narrowly based and driven by part-time work, the labour market is clearly stronger and tighter than we would have expected given signs of deceleration in economic growth to end Q1, which supports the continued hawkish tone from the Bank of Canada,” he said.

James Orlando, Senior Economist with TD Economics, said once again, the Canadian jobs market surprises to the upside.

“Over the last seven months, employment has risen 412k, three times the trend pace over the 2010 to 2019 time period. This has been driven by rapid population growth, which has surged by a million people in the last year. The supply of workers has been boosted, enabling firms to put a big dent in the number of job vacancies,” he said.

“The BoC won’t change its policy stance based on this report. The inflow of new Canadians is changing the calculus on what a standard jobs report looks like. The fact that the unemployment rate has been stable means that we may have reached a new steady state. This means that the ‘surprise’ employment report isn’t adding the same labour market tightness as it would have in the past. Plus, the BoC can always focus on the lack of breath in sector hiring and the fact that this print was driven by part-time employment, with full-time employment going negative. All told, the BoC’s position on the sidelines is probably more stable following today’s release.”

Douglas Porter, Chief Economist with BMO Economics, said the robust headline job gains are no doubt being flattered by strong underlying population growth, and all of last month’s rise was of the part-time variety.

“Nevertheless, the key point is that there is no evidence that the labour market is softening at all, lending important support for the broader economy. If this persists through the spring, the Bank of Canada may yet be forced to rethink its rate pause, especially with the housing market showing signs of reviving. All eyes will now turn to the next inflation report (CPI, May 16), which needs to continue slowing to keep the Bank on the sidelines,” he said.

(Mario Toneguzzi is Managing Editor of Canada’s Podcast. He has more than 40 years of experience as a daily newspaper writer, columnist, and editor. He worked for 35 years at the Calgary Herald, covering sports, crime, politics, health, faith, city and breaking news, and business. He works as well as a freelance writer for several national publications and as a consultant in communications and media relations/training. Mario was named in 2021 as one of the Top 10 Business Journalists in the World by PR News – the only Canadian to make the list)