August sees lowest level of employment for manufacturing since March 1998

Employment was little changed for the third consecutive month in August 2006, marking the longest stretch without gains since the end of 2001, according to the latest Labour Force Survey from Statistics Canada. The unemployment rate edged up 0.1 percentage points to 6.5 per cent, still among the lowest in 30 years.The pause in employment growth over the last three months follows a period of very strong gains. So far this year, employment is up 194,000 (+1.2 per cent), due entirely to increases in full time.
In August, full-time work jumped 47,000, but was more than offset by losses in part time (-63,000), especially for adult women and youth aged 15 to 24 years. Employment gains among adult women so far this year (+2.1 per cent) have exceeded that for adult men (+0.6 per cent).The goods-producing industries have continued to be affected by waning foreign demand. Manufacturing employment declined in August, bringing losses to 87,000 since the beginning of 2006.
The service-producing side of the economy has fared much better in recent months. However, in August there were losses in education, and public administration. Only professional, scientific and technical services posted a large employment increase.
Average hourly wages increased 3.7 per cent from August of last year, remaining above the most recent year-over-year gain of 2.4 per cent in the Consumer Price Index. Hourly earnings in Alberta were up 8.3 per cent over the previous 12 months.
When adjusted for comparability to US definitions, employment growth in Canada paralleled that of the United States over the first eight months of the year (+1.3 per cent). The unemployment rate also declined by a similar amount during this period.

EMPLOYMENT IN GOODS-PRODUCING INDUSTRIES WEAKENS

Manufacturing has been shedding workers since 2002, with August marking the lowest level of employment for this industry since March 1998. Since the start of 2006, manufacturing declines have been widespread, with the largest decreases in food and motor vehicle and parts manufacturing.
While manufacturing losses have affected men and women equally, women have fared better with the expansion of the service sector so far this year. The latest gross domestic product estimates for the second quarter of 2006 indicate continued strength in the service industries and weakening in the goods industries.
Employment in educational services declined by 20,000 in August, mainly in primary and secondary schools. The trend since the start of the year has been flat, after showing strong growth in 2005.
Employment also fell in public administration in August (-21,000), offsetting an increase of similar magnitude in the previous month. Part of the decline may be attributed to the winding down of Census 2006 activities. The industry has been keeping pace with overall employment since 2003.
Professional, scientific and technical services posted a large increase in employment for August (+19,000), with more workers added in architectural, engineering and design services. Despite August’s growth, this industry has remained virtually flat since the start of 2006.

ALBERTA RESPONSIBLE FOR HEFTY SHARE OF COUNTRY’S EMPLOYMENT GAINS

Alberta has been responsible for 78,000 or 40 per cent of all employment added in Canada since the start of 2006, eclipsing even Ontario’s gain (+68,000 and 35 per cent) during the first eight months of the year. This share is considerable, especially coming from a province that accounts for only 10 per centof the country’s working-age population.
In August, employment edged up in Alberta (+8,000), but an increase in the number of people searching for work boosted the unemployment rate to 4.2 per cent, up 0.6 percentage points from July.
Although employment was little changed in Ontario for August, so far this year, its 1.1 per cent gain closely follows the national rate of growth. In comparison, Quebec’s employment growth has been much slower over the first eight months of the year (+0.3 per cent). Setbacks in manufacturing have hindered employment growth in both provinces, although for Ontario, strong gains in the service sector have more than counterbalanced the declines.
A large jump in full-time employment in Newfoundland and Labrador pushed the employment rate to a near-record high of 50.5 per cent in August. The gains were spread across several industries.
New Brunswick posted an employment decline of 5,000 in August, bringing employment to about the same level as 12 months ago.

SELF-EMPLOYMENT RALLIES

Following large declines early in the year, self-employment rebounded in August (+27,000), mainly due to gains in construction, trade, as well as business, building and other support services.

STUDENTS HAVE BEST AUGUST IN THREE SUMMERS

Older students (aged 20 to 24) experienced their best August for summer employment in three years. Their employment rate was 72.0%, up 2.6 percentage points from the previous year. Among those who were employed, nearly 70 per cent had full-time work. Their unemployment rate was a low 5.5 per cent, compared to 6.6 per cent in the same month of last year.
Teens 17 to 19 years of age also fared well this August with 62.7 per cent employed the highest rate in three years. About half of these working teens were employed full time.
For the summer as a whole (average of May to August), students aged 17 to 19 had the largest employment increase from the previous summer. Their employment rate increase of 2.3 percentage points was nearly twice that for students in their early twenties.
Note: From May to August, the Labour Force Survey collects labour market information about young people aged 15 to 24 who were attending school full-time in March and intend to return to school in the fall. The published estimates are not seasonally adjusted. Therefore, comparisons can only be made on a year-over-year basis.Article initially appeared on MRO Magazine’s Web site, another publication of Business Information Group, LP