Canada’s Strong Job Market Jan 2023 & Economy: Highlights
- Canada added 150,000 jobs in January, exceeding most economists’ expectations
- Unemployment rate held steady at 5%
- Job gains were made across sectors, with wholesale and retail trade experiencing the largest gains to employment
- Wages were up 4.5% on a year-over-year basis
- Despite the anticipation of higher interest rates slowing the economy, employment has been on an upward trend since September
- TD Bank Senior Economist James Orlando calls the report a “blowout jobs report”
- Professor of economics Moshe Lander says the report runs counter to rumblings about a possible 2023 recession
- CIBC Senior Economist Andrew Grantham says the uptick in hours worked suggests the economy isn’t on the verge of a recession
- Bank of Montreal revised its call for a recession, now expecting “moderate growth” in GDP this quarter
- The stronger Canada’s labour market remains, the later a recession is likely to set in, and it might be less painful if it does arrive
- The Bank of Canada has taken a conditional pause from further interest rate hikes as it assesses the economy’s response to higher rates
- The Bank of Canada says the tight labour market is a sign of an overheated economy and needs to ease for inflation to come down
- The Bank of Canada says it needs an accumulation of evidence that inflation isn’t following its forecast before it would raise rates further
- Before the jobs report, markets had been betting on a rate cut; after the report, there’s a greater probability of a rate increase.
