January 5, 2013
EDMONTON, AB, Jan. 5, 2013/ Troy Media/ – Employment in the Edmonton Census Metropolitan Area (CMA) edged down in December 2012 as job losses in the goods producing sector outweighed gains in services related sectors. Industries related to construction, manufacturing and energy showed lower employment in December, while employment in financial services and retail trade industries were up.
The unemployment rate for the region rose from 4.1 per cent in November 2012 to 4.3 per cent in December 2012. Even with this slight increase in the unemployment rate, Edmonton is now tied with Regina for the lowest unemployment rate among Canada’s metropolitan areas.
Alberta also saw a modest decline of about 6,000 jobs in December 2012. This decline, combined with an increase in the number of people looking for work, brought the province’s unemployment rate up to 4.5 per cent in December from 4.2 per cent in the previous month. Despite this increase, Alberta still continues to enjoy the lowest unemployment rate among all the provinces in Canada.
On a positive note, Alberta’s job losses were all in part-time positions as the number of full-time workers rose over the month of December. This situation suggests that incomes and consumer confidence will not be seriously affected by December’s slight decline in employment.
Canada saw a solid gain of 40,000 jobs in December. All of the gains at the national level were in full time jobs – a trend similar to the previous month. The key drivers of December’s national job growth were the gains in transportation and construction sectors. However, Canada’s unemployment rate dropped only marginally to 7.1 per cent (when comparing November 2012 to December 2012) as more people entered the labour force and increased the numbers of individuals seeking work.
In spite of December’s weak results, the Edmonton region’s economy continues to outperform Alberta and Canada in job creation, labour force growth and expansion of the working age population. With rising employment and incomes, the focus of growth in Edmonton is shifting from manufacturing and construction areas to retail, personal services and entertainment industries.
Nonetheless, even with positive growth in the labour force and the working age population seen in the past year, unemployment rates are now hovering just above 4.0 per cent – signaling very tight labour market conditions. This level of unemployment suggests that labour shortages may become much more widespread than they are at the moment. Such deep, systemic shortages could in turn spark a rapid run up in wages and salaries in 2013.
Because employment trends, particularly in the full time category, tend to lag behind trends in overall economic activity, they are a better indicator of past rather than current developments in the economy. However, employment trends are useful predictors of future changes in incomes and consumer spending. Statistics Canada publishes a three month moving average of all labour force values for the Edmonton CMA, an approach that sometimes results in the number of reported jobs lagging behind developments in the Edmonton CMA economy.
John Rose is Chief Economist with the city of Edmonton.
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