Ottawa-Gatineau unemployment rate moves up to 4.9% in December

Ottawa

Slight job gains in the tech sector weren’t enough to offset losses in several other industries as Ottawa-Gatineau’s unemployment rate edged up slightly in December, Statistics Canada reported on Friday.

The total number of jobs in the National Capital Region fell by about 1,100 from November, dropping to 736,400 last month, while the labour force grew by 1,600 people, the agency said. Overall, the region’s unemployment rate jumped to 4.9 per cent in December, up from 4.6 per cent the previous month.

The number of employed residents dropped despite a second consecutive month of gains in the all-important tech sector, which added about 1,200 jobs last month to push its total to 38,600. Also on the plus side, the education sector added nearly 5,000 positions in December, while business and support services and the accommodation and food services sectors also made gains.

But public service employment remained steady at just over 168,000 positions, and health care and transportation-warehousing suffered net losses of more than 2,000 jobs apiece.

Steady across the country

Nationwide, the unemployment rate stayed at its 43-year low of 5.6 per cent last month as the economy closed out 2018 with the addition of 9,300 net new jobs, StatCan said.

For the second straight month, the jobless rate was at its lowest level since the agency started measuring comparable data in January 1976.

Economists had expected the addition of 5,500 jobs in December and an unemployment rate of 5.7 per cent, according to Thomson Reuters Eikon.

But even in a tightened job market, the latest labour force survey shows wage growth delivered another weak reading in December of 1.49 per cent ​– well below inflation.

Year-over-year average hourly wage growth for permanent employees was 1.46 per cent in November ​– and it has decelerated steadily since its May peak of 3.9 per cent.

The December result follows a gain of 94,100 net jobs in November, the country's largest monthly increase since March 2012.

In the jobs report Friday, the overall employment gain of 9,300 for December was deemed too low by Statistics Canada to be statistically significant.

But a closer look revealed some important changes.

Alberta, which has been hit hard by a drop in oil prices, saw a net decrease last month of 16,900 jobs or 0.7 per cent compared with November, as an increase in part-time work was far outweighed by a loss of 36,200 full-time positions.

For all of 2018, employment in Alberta rose 0.9 per cent as the province added 21,600 jobs. The provincial unemployment rate fell from seven per cent at the start of 2018 to 6.4 per cent at the end of the year.

Statistics Canada said the country gained 163,300 net new jobs in 2018 for an increase of 0.9 per cent, which was a slower pace of growth compared with 2.3 per cent in 2017 and 1.2 per cent in 2016.

Employment growth in 2018 was concentrated in the services sectors, which generated 151,000 positions compared to an increase of just 12,300 in goods-producing industries.

In 2018, employment for women aged 25 to 54 grew by 125,600 positions or 2.2 per cent, compared to an increase of 60,600 jobs or one per cent for men in the same age category.

The report Friday was the first major economic data release of 2019.

The Bank of Canada has been monitoring wage growth ahead of its interest-rate decisions as it tries to determine how well indebted households can absorb higher borrowing costs.

The central bank, which will make a rate announcement next Wednesday, has raised its benchmark rate five times since the summer of 2017 in response to Canada's strong economic performance. Governor Stephen Poloz has signalled that more increases will be needed to prevent inflation from rising too high.

​– With files from the Canadian Press