The Canadian job market has recovered strongly over the past year. In September 112,000 new, full-time jobs were created, even though part-time employment shrunk by an almost equal number.

“On a regional basis, September job creation was driven by gains in Ontario (+35K) which more than offset declines in Quebec (-8K), Alberta (-8K) and British Columbia (-7K).” (National Bank of Canada, October 6, 2017)

Canada’s monthly job numbers are rather unrealizable, so we pay much more attention to the year over year changes to gauge the underlying patterns. Accordingly, job creation is running at an unsustainable high pace of 320, 000 over the past twelve months, with 90% of the expansion centred in full-time employment.

In view of this rather strong employment growth, it is not too surprising that wage inflation in Canada is starting to heat up. In September, average hourly earnings accelerated by 0.4%, its largest gain in 7 months, and consistent with a tightening (if regionally unbalanced) labor market.