Canadian employment likely rose modestly in September, jobless rate to have risen to 5.8 pct

Canadian employment data for the month of September is set to release tomorrow. In the last 12 months, the Canadian labor market has made remarkable performance, adding 470k jobs in that period. However, employment is likely to have risen modestly by 5k in September, which is well below the current six month trend of 30k, said TD Economics in a research report.

This projection assumes mean reversion following last month’s 81k rise that stands as the second highest since 2012, trailing only the 106k print from April. Details are likely to prove more downbeat with a fall in private employment and the jobless rate likely to rise to 5.8 percent after last month’s sharp rise in labor force participation, which helped to hold the unemployment rate unchanged.

“Wage growth should be the one bright spot, with average hourly earnings forecast to hold at 3.8 percent y/y as recent gains have helped sap even more slack from the labour market”, added TD Economics.