Unemployment Rate in April Holds Steady at 6.1%

According to Statistics Canada, despite adding 90,000 jobs in April — which was 70,000 more than most economists predicted — Canada’s unemployment rate in April remained unchanged (since March) at 6.1%, following six straight months of declines.

Sectors that saw the biggest job gains in April were professional, scientific and technical services (+26,000; +1.3%); accommodation and food services (+24,000; +2.2%); health care and social assistance (+17,000; +0.6%); and natural resources (+7,700; +2.3%). The biggest drop was seen in utilities (-5,000; -3.1%).

Unemployment Rate In April – Breakdown

Interestingly, in April more than one in four workers (28.4%; population aged 15 to 69) came into work, or connected to a work device, at short notice at least several times a month. Workers in management occupations (59.8%) and specialized middle management occupations in health care (55.9%) were the most likely to experience this.

The unemployment rate in April, despite the surprise increase in jobs (90,000 vs. 20,000), has largely shifted sentiment that the Bank of Canada will cut its overnight rate at its next meeting in June. However, the general consensus remains that cuts will start occurring in the latter half of the year.

Stated TD Economics: “Our forecast points to a widening policy rate gap, with the BoC expected to cut in July and start speeding up the pace of cuts at the end of 2024.”

Stated CIBC Asset Management: “The gradual rebalancing of the Canadian economy has pursued, but at a slower pace than anticipated by the BoC in its previous forecast materials. That said, inflation has steadily decreased over the last six months from 3.8% in September 2023 to 2.8% in February 2024. If sustained, the progress made on the inflation side provides reasonable grounds for Canadians to expect to see cuts later this year, but perhaps not as many as the market is currently discounting.”

The country’s unemployment rate in April, which stayed steady at 6.1%, indicates that while job creation is robust, other economic factors are keeping the unemployment rate in April stable. The next set of unemployment rate numbers for May will be published by Statistics Canada on June 7, 2024.

Sources:

Statistics Canada – Labour Force Survey, April 2024

TD – Addressing Issues Impacting the Economic and Financial Outlook

CIBC – Bank of Canada holds the policy rate today