Statistics Canada released the country’s employment and unemployment figures for December 2023 this afternoon.
The nation’s unemployment figures were flat and unmoving at 5.8 percent, indicating a general stability in the labour force.
According to Statistics Canada:
Employment was virtually unchanged (at 0.0 percent) in December, and the unemployment rate held steady at 5.8 percent. The employment rate fell 0.2 percentage points to 61.6 percent, as the population aged 15 and older grew by 74,000 – plus two percent”
This is somewhat positive news, after October and November 2023 both showed marginal unemployment rises of 0.1 percent. The November 2023 unemployment figure was 5.8 percent, despite the economy adding 25,000 jobs in the month.
Employment disappoints
Canada’s actual employment numbers, on the other hand, were more pessimistic. The country added 0.1k jobs in December – far below the previous estimate of around 13k from analysts.
Also, on the whole, Canada’s employment trended downwards overall throughout 2023, according to Statistics Canada.
The employment rate has trended down in 2023, as population growth generally outpaced employment gains. In December, the employment rate (61.6 percent) was down 0.9 percentage points from its recent high of 62.5 percent recorded in January 2023.”
FX: Movements of the CAD
Meanwhile, the USD to CAD rate has been reflecting the anticipation in the markets for today’s US Nonfarm Payrolls and Canada’s employment data, both released within minutes of one another this afternoon.
The USD/CAD spiked up to highs near 1,3380 off the back of a bullish dollar while investors awaited Nonfarm Payrolls out of the US on January 5th, before correcting back downwards to around 1,3362.
Read more: USD/CAD figures ahead of NFP
Significance of the figures
In a week full of important figures like Nonfarm payrolls and inflation figures for December, all eyes are on several developed nations to see how many ‘stuck the landing’ for a tough end to 2023, thanks to high inflation and high interest rates.
Canada, in particular, has held fast to a course of three consecutive decisions to hold the interest rate firm at five percent for much of the latter half of 2023.
A high or climbing employment figure is an important grassroots figure. Generally speaking, people who are earning a salary are people who are spending, pumping much-needed consumer activity into the market.
As such, a rise in employment and a drop in unemployment can often be a leading indicator of economic growth – while rising joblessness claims can be an early warning sign of hard times ahead.
Canada maintains status quo, while America booms
Although no signs of unemployment increasing is usually not bad news, it’s not quite the clear good news that a precipitous rise in employment is. Canada, therefore, seems to have maintained the status quo today by avoiding bad news, rather than actively announcing good news.
America, on the other hand, released a bumper crop in their nonfarm payrolls report for December, adding 216,000 jobs instead of the anticipated 170,000.
Read our commentary on Nonfarm Payrolls: ‘We’ll see markets consolidate’
This article first appeared on Invezz.com
