DLC economist releases employment report

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The industry’s leading economist says employment data does not fall in line with BoC Governor Stephen Poloz’s recent statements, and recovery could be on the way for Alberta.

“The losses in Canadian employment in April contrast with Bank of Canada Governor Stephen Poloz’s comments last week that non-energy companies were starting to take over from the weakness in the oil patch,” Dr. Sherry Cooper, chief economist for Dominion Lending Centres wrote in her latest economic report. “Oil and gas producers have cut back on new building projects this year, while the retail industry has been battered by store closures at Target Corp. and Best Buy Canada (via their Future Shop division). Moreover, another 18,900 people left the labour force.”

The employment data released for Canada was released Friday, and it indicated the largest drop in part-time work in four years, which Cooper attributes to the economic damage done by the collapse in oil prices.

Employment fell by 20,000 jobs. Luckily, the loss of part-time jobs was offset by an increase in full-time jobs, leaving the unemployment rate steady at 6.8 per cent for the third month in a row.

There was, however, some good news for Alberta-based brokers.

“The good news is that oil prices have recently risen to over $60 a barrel for West Texas Intermediate, but are still down from more than $100 last year,” Cooper wrote. “Prices have crept up in recent weeks from lows of below $45 a barrel.”

Employment actually rose in Alberta and Newfoundand last month – the two provinces hit the hardest by the oil declines.
 
  • Darr Robbins on 2015-05-11 5:00:10 PM

    The April data suggest that Canada lost 66,500 part-time workers. Most of these, were in the retail area. What does not jive with both explanations for Governor Poloz and Dr. Cooper is that low oil prices cannot account for this labor contraction. Best-Buy and Target lay'd-off workers because of low demand, not because of declining oil prices. Expect the BoC to lower yields in parallel with the US Federal Reserve to prevent the stock market from deleveraging as sales and earnings will not materialize. Keep an eye on inventory build-up.

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