OTTAWA — Canada’s unpredictable labour market delivered another huge surprise in May, piling on 95,000 jobs — the biggest monthly gain in 11 years — and trimming the unemployment rate to its lowest level in four months.
Most of the new jobs — representing the largest increase since August 2002 — were full-time positions, and nearly all were created by the private sector, Statistics Canada said Friday. The unemployment rate declined to 7.1% — matching the level in December 2012 — from 7.2% in April. Continue reading.
Statistics Canada figures — they are not broken down between residential and commercial employment — show the seasonally adjusted data for construction jobs is the best monthly number in the past decade.
It has even the economists confounded.
“I think there is a bit of disbelief. It’s so surprising,” said Sonya Gulati, senior economist with Toronto-Dominion Bank.
She notes data is seasonally adjusted but even with that factored in you can get some upward momentum based on the time of the year that numbers comes out.
But the real estate sector got more positive news from building permit numbers released this week by StatsCan which showed Canadian municipalities issued $7-billion in permits in April, up 10.5% from March. It was the fourth straight month that the figure has risen.
It’s not just residential construction that is booming, the office component of commercial activity continues to experience good times across the country.
“There are 19 million square feet of office under construction. There are 20 plus office buildings going up as we speak,” said Ross Moore, director of research for Canada for CB Richard Ellis. “In downtown Toronto, we’ve never seen so much under construction, including the 1970s and 1980s.”
All this leaves the economy more vulnerable to real estate than ever and the hope is once the residential sector ramps down those jobs will eventually be replaced, said Avery Shenfeld, chief economist at CIBC. “We need by 2014 something to step up and take the place of home building as a source of job growth and the hope is it’s the export sector and non-residential construction associated with business and capital spending. It’s a reasonable hope.”
Bill Ferreira, director of government relations and public affairs at the Ottawa-based Canadian Construction, said the overall trend in the sector has been positive.
“There are a number of things going on in the country, that require additional construction capacity,” he said. “Some of it is the hot condo markets in cities like Toronto and Vancouver. Others have been include been natural resource extraction, so infrastructure required to ensure that those projects can go forward.”
But he suggested it might be a bit too early to get overly excited about the job growth since there are so many month-to-month variables.
Brian Johnston, chief operating officer of Mattamy Homes, said there is no question in Ontario that slowing sales have cooled hiring in the province.
“But we are definitely hiring out west. It’s just exceptionally strong,” said Mr. Johnston. “I just met with my president this morning and he was showing me this big huge organizational chart with yellow boxes [that stand] for people we need to hire. I’m going ‘you have a lot of work in front of you’ because it very difficult to get people and staff out west.”