Canadian Jobs Preview: Forecasts from five major banks, fairly moderate employment growth in June

Canada will release June employment figures on Friday, July at 12:30 GMT and as we get closer to the release time, here are forecasts from economists and researchers at five major banks regarding the upcoming employment data. 

Another 22,5K new workers are expected in May, following April’s gain of 39,8K. The unemployment rate should remain at 5.1% and the participation rate is also forecast to be unchanged at 65.3% just 0.3 points below its final pre-pandemic level.

NBF

“Our call is for 25K increase. Such an improvement of the labour market would leave the unemployment rate unchanged at 5.1%, assuming the participation rate remained at 65.3%.” 

RBC

“We expect Canadian employment growth slowed to 15K in June – driven by a dwindling supply of workers rather than a lack of demand. Canada’s unemployment rate likely held at 5.1%. But wage growth probably accelerated again, as businesses compete for fewer available workers.”

CIBC

“A more moderate 25K increase in employment would be broadly in line with the pace of population growth and means that, assuming no change in the participation rate, the jobless rate would hold steady at 5.1%.”

Citibank

“We expect a solid 45K increase in employment in June, similar to the rise in May but with two-sided risks. The path of wage growth however will likely be more important to determine  whether the BoC starts to ease up on aggressive rate hikes later this year or if they remain more hawkish in line with the Fed.”

TDS

“We look for the Canadian labour market to add another 32K jobs in June, pulling the unemployment rate to a new low of 5.0%. We also look for a sharp increase in wage growth for permanent employees, rising to 5.6% from 4.5% in May, on a combination of base effects and another sizable MoM increase.”