by Ari Charney, Investing Daily
Well, we finally got the news we’d been expecting: Canada’s economy contracted for two consecutive quarters. According to Statistics Canada, gross domestic product (GDP) growth declined by 0.5% during the second quarter, following a revised drop of 0.8% in the first quarter.
But while most journalists are content to call this a recession, “technical” or otherwise, many economists note that two consecutive quarters of falling GDP shouldn’t be considered a recession unless they’re accompanied by significant declines in employment, as well as deterioration in other key areas.
In fact, the opposite has occurred: Canada’s economy has added nearly 318,000 full-time jobs over the past year, with more than half of those jobs created year to date, a period during which the country has borne the full brunt of the oil shock.
Equally important, full-time jobs are now driving the employment market. That’s a welcome contrast to the period from mid-2013 through August 2014, during which full-time job creation essentially stagnated, while more and more new jobs were only part-time.
The trend has thankfully reversed, and that augurs well for the economy: Full-time jobs tend to be higher quality than part-time jobs, owing to better pay, greater benefits and lower turnover.
The total number of hours worked, an important indicator of future labor demand, also underwent a period of stagnation for nearly two years. But over the past 12 months, the total number of hours worked has risen by a respectable 2.2%.
Similarly wage growth, which underwent a marked deceleration following a post-Global Financial Crisis peak in mid-2012, is finally strengthening again, up 3.4% over the trailing year.
Somehow, despite crude oil’s collapse, Canada’s job market is rapidly improving.
So which sectors are showing the strongest employment growth? In terms of the numbers of new jobs, the healthcare and educational services industries account for 40.5% and 27.4% of new jobs, respectively.
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