Canada: Labour market likely to add 15k jobs in January - TDS

Analysts at TD Securities are looking for the Canadian labour market to add 15k jobs in January, led by a rebound in services sector hiring.

Key Quotes

“Services saw an outsized pullback in retail and public administration employment throughout December, the latter of which registered the largest one-month net job loss since mid-2016. Together, these two industries shed over 35k workers which suggests some mean reversion into 2019.”

“Meanwhile, goods-producing employment will face a headwind from layoffs across the energy sector, a likely result of government mandated caps on oil production, and a giveback in manufacturing employment after 20k jobs were added last month.”

“Elsewhere we also look for a recovery in private sector job growth following last month's rotation into self-employment. Job growth of 15k should leave the unemployment rate unchanged at the current cycle low of 5.6% while wage growth should firm modestly to 1.7% y/y, still well below levels associated with a tight labour market.”