Canada just dropped a killer job report that showed we added 48,000 jobs… when seasonally adjusted. The problem with seasonal adjustments are they place primary focus on the total jobs created, and glosses over the quality of jobs created. So I wanted to take a closer look at non-adjusted numbers, to see how it compared year over year. The January 2017 Labour Force Survey from Statistics Canada reveals a few negative trends when compared this way – like most jobs were part-time, and inflation grew faster than wages.
Part-Time Jobs Are Replacing Full-Time
Job creation was actually pretty solid when looked at year over year. January saw 294.2k jobs added, a 1.66% increase from the year prior. 93,000 of those jobs were full-time, with the rest being part-time gigs. While not ideal, it sure as hell beats losing jobs.
When looked at month over month, it’s a little less positive. Yes, some jobs are lost to seasonal employment during the holidays, but January was the first month since April 2016 that employment fell below 18 million. January saw 220,300 full-time jobs disappear from the month before. Meanwhile part-time employment grew by 43,300 jobs, and unemployment grew by a whopping 136,100 people.
Canadian Full-Time Employment
Canadians Are Making Less
Wages across Canada grew, just not as fast as they need too. The average hourly wage across all employment sectors grew by 1.2% to $25.97/hr. Unfortunately, the rate of inflation eats up that number and then a little more. Inflation as measured by the CPI from the Bank of Canada came in at 1.5%, which was 25% faster than wages grew. This means the average Canadian’s hourly wage is actually worth less in today’s dollars than it was a year ago.
Canadians Are Working Less Hours
One of the less tracked but equally important measures is the number of hours worked. The number of hours worked declined by 1.12% to 35.2 hours. While that seems like it’s only 0.4 hours a week, at the average hourly wage that means $540 less per year. Not exactly chump change, and that can add up.
So yes, we did create 48,000 jobs when seasonally adjusted, but don’t let that confuse you. The quality of employment, hours worked, and wages paid are just not doing so hot. What’s more important from a macro perspective – that jobs were created, or Canadians have less in buying power this year?
Like this post? Like us on Facebook for the next one right in your feed.
If you believe inflation only grew by 1.5% too. In real numbers it’s much worse.
If you get a wage increase at all.
Thanks Daniel for another great article. I’ve been sharing these on LinkedIn. Any articles with key statistics are always useful and I tend to share those a lot more.
Thanks for sharing and the feedback Jeff! I’ll relay the comments to Daniel, and ask him to crank up the stats work.
Brampton mortgage fraud:
As you may know, mortgage fraud grows from a few broker making extra commissions to systemic corruptionism when there is a ready, willing and myopic buyer of mortgages. The ability to sell a mortgage with no questioned asked shifts the lender’s income away from collecting monthly payments to the cash from the quick re-sale of the mortgage.
When the buyers of the mortgages can bundle and securitize the mortgages, they money from the investment vehicles anad as happened in the US, then executives in the investment firm will them sell “insurance” to the buyers of the securitized bundles so that if the bundled mortgages under-perform, the investment house will pay the difference.
The executives then buy this same “insurance” — which is not called insurance as they need to evade the insurance regulation that the insured persons need to have an insurable interest in the property. The soon the bundled securities crash, the sooner the executives who put them together collect on their “insurance.”
This system make bad mortgages more desirable that valid mortgages as they will default sooner. In return this makes it easier of the local broker to make a loan as the buyer’s qualifications are no longer important. In fact, near the end of this Ponzi type scam, there will be no buyers at all. The brokers will just falsify the papers work ab initio, sell the mortgage to the investment home, which bundles it and sells the security while purchasing insurance in the event it under performs.
This scam is not the only way the market can crash, but it is what crash the US housing market in 2008. Presently, in LA they are commodizing condos as investment vehicles and tear down rent controlled units to make room for the high rises. I believe the vacancy rates for this segment of the market is higher than your data indicate. One should not lump the low end of the market with the higher end of the market. Due to the destruction of rent controlled units, the vacancy rate for the poor is very low.
One last point: Please do not confuse rent controlled units (RSO in Los Angeles) with “affordable Housing.” There is no real meaning to the buzz words Affordable Housing. They are used to mislead and deceive the gullible.
Thank-you for some great reading Daniel!