Economy adds jobs but growth still slow

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Canadian employers resumed hiring last month, though many of the new jobs were part-time positions for older workers.

The economy added 59,200 jobs in August, nearly three times higher than forecasts and after Canada shed almost 40,000 jobs in July.

Jobs numbers have been notoriously volatile of late, so more analysts are focusing on three- or six-month moving averages to smooth out the bumps. By that measure, employment gains have slowed to 12,000 a month in the past half year from 29,000 on average in the previous six months, a reflection of moderating economic growth.

Last month's jump in hiring "was not enough to change our view that the Canadian economy remains stuck in a slow-growth rut," said David Watt, chief economist at HSBC Bank Canada, adding that tepid wage gains won't encourage much consumer spending.

Employers added 41,800 part-time positions, while full-time jobs rose by 17,400, recouping most of the prior-month losses.

The private sector accounted for much of the gains, boosting payrolls by 30,900, while public-sector head count rose by 9,000.

More people are turning to self-employment. The number of self-employed grew by 19,200 last month. Over the past year, self-employment has grown 3.6 per cent, while private-sector positions have risen 1.5 per cent and public-sector employment has fallen 0.4 per cent.

Ontario and Alberta led the hiring gains, with the latter province expanding head count in four of the past five months. By city, Regina has the lowest jobless rate in Canada, at 2.9 per cent, while Saint John has the country's highest rate, at 10.5 per cent.

Wage growth has been slowing. Average hourly earnings were about 1.5 per cent higher in August than a year earlier, less than half the pace of this time last year. And while the Statistics Canada numbers show the jobless rate easing to 7.1 per cent, it's been at or above the 7-per-cent mark since December, 2008.

This year's labour market resembles "a hamster wheel," said Erin Weir, economist at the United Steelworkers. "With employers providing almost enough jobs to keep up with population growth and offering wage increases just sufficient to cover inflation, Canadian workers are running faster to stay in place."

Employment rose among people over the age of 55, continuing a long-term trend as the

population ages.

Young people still face challenges. The youth jobless rate rose to 14.1 per cent from 13.9 per cent. Less than a quarter, or 24.4 per cent, of students aged 15 and 16 worked this summer, the lowest rate on record.

"The lack of new opportunities being created – along with delays in the older generation retiring – have combined to put particularly acute pressure on those workers lacking in solid on-the-job experience," said Kelly Dixon, president of the job-search site Workopolis.

Temp work is growing, and that may help young people get a foot in the door, she added, noting that current hiring is particularly strong among retailers. Discount retail chain Target, for example, said on Friday it plans to open 23 more stores in Canada this fall.

By sector, more people landed jobs in health care in August, while the education sector shed jobs. The construction sector has added more jobs than any other over the past year, with 113,000 new positions, bringing its share of total employment to a record high, according to Mr. Watt.

Factories have shed 53,000 jobs, a reflection of ongoing restructuring in the sector.