Canada’s employment rate will continue to cool and wage growth will slow in 2024, but the job market will hold up better than in previous downturns, according to a report published by TD Economics on Monday.
The country’s job market has held up well during the Bank of Canada’s interest rate hikes last year, growing by 2.4%, or adding about 500,000 net new jobs. The unemployment rate in the last quarter of 2023 was 5.8%, similar to the same quarter in 2019.
“While private-sector job creation has ratcheted down significantly in recent months, mass job losses have failed to materialize as some forecasters had been anticipating,” the report said.
Instead of weakening labour demand being the primary cause for higher unemployment rates as seen in the past, an abundant labour supply will be the dominant driver of higher unemployment in this cycle, TD said. While employment rates in every province outpaced labour force growth in 2023, every province will see higher labour force growth rates relative to employment rates this year.
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Source : Investment Executive, By: Jonathan Got, February 5, 2024