The jobless rate in Canadian manufacturing is at an all-time low or just 2.6%. PHOTO courtesy Universal Robot.
Year-over-year wage growth in manufacturing is moderating somewhat but it’s still growing at a brisk pace, the latest data from Statistics Canada reveal.
Average hourly earnings in the manufacturing sector rose 0.9% in January, marking the sixth straight monthly advance.
“On a year-over-year basis, wage growth came in at 6.5% in January, down from 6.6% in December and from 7.5% in November…indicating that manufacturers continue to face significant challenges finding workers,” comments Alan Arcand, chief economist with Canadian Manufacturers & Exporters.
The upward push on manufacturing gains stems from continued gains in jobs and record low unemployment in the sector. Manufacturing employment rose by 7,300 (+0.4%) in January, the strongest gain in three months while the jobless rate in manufacturing hit an all-time low, falling 0.1% to just 2.6% in January. In contrast the unemployment rate for the Canadian economy overall held steady at 5.0% in January, which itself is just a bit higher than the record low of 4.9% reached last June and July.
“The surge in hiring in January suggests that the Canadian economy is not heading into imminent recession, defying many economists’ predictions,” Arcand says.
Manufacturers who have had a difficult time filling open job positions in such a tight labour market can take some heart in the fact that in the third quarter of 2022 Canada’s population grew at the fastest rate in over 50 years, mainly driven by an increase in non-permanent residents, according to Statistics Canada. Non-permanent residents hold various kinds of work permits. As of January, this group accounted for 3.4% of total employment.