In the view of analysts at Scotiabank, Canada’s May jobs report is likely to show stronger headline numbers while wage growth is also seen rising somewhat.
Key Quotes:
“Friday’s jobs report for May could post a headline improvement in the pace of job creation and perhaps further upward pressure upon wage growth.
Recall that the prior report for April was stronger in the details than the headline drop of 1,100 jobs indicated.
Excluding youths, jobs were up 21.4k in April as the youth category has been distorting the overall figure throughout the year. Youth employment fell by about 22k in April. Solid underlying momentum in the ex-youths category has been observed every month this year and it’s unclear why the youth category has been this soft.
Wage growth is expected to rise somewhat, in part due to the fact that Quebec raised its minimum wage by 7% in May. BC will raise its minimum wage by over 11% in June, then Alberta’s minimum wage goes up again in October and Ontario’s increases again next January; so legislative changes could impact wage growth-and pass through to affected CPI categories like restaurants and home services for quite some time yet.”
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