Data released on Friday showed the Canadian economy created 73.000 jobs in March. Analysts at the National Bank of Canada point out that after a spectacular hiring spree in February, a pause would have been quite normal but did not occur. They explained private sector hiring continued, particularly in the sectors hardest hit by the pandemic, where employment levels are now at a cyclical high.
“We are also pleased that job gains stemmed from full-time employment. These developments have allowed the unemployment rate to reach an all-time low in the country. This is partly due to the significant drop in Quebec’s unemployment rate to a new record low, but we also note that all but two provinces have unemployment rates at or below their pre-crisis levels.”
“After this recent boom, it should come as no surprise that employment gains will likely moderate from here on out. The tightness of the labour market means that while companies still have very elevated hiring intentions according to the Bank of Canada’s latest Business Outlook Survey, they may have difficulty finding candidates.”
“While the current monetary policy would be appropriate in times of economic difficulty, it is simply inadequate in the present situation (arguably for several months now). This morning’s report cements our view that the BoC will raise rates by 50 basis points next week.”