Economy added 108,000 new jobs last month — but cost of living still leaving many workers behind

Canada's economy added more than 108,000 jobs last month. (Lucas Jackson/Reuters - image credit)
Canada's economy added more than 108,000 jobs last month. (Lucas Jackson/Reuters - image credit)

Canada's economy added 108,000 jobs in October, about 10 times what was expected, but even an unexpectedly hot job market isn't doing much to bring down the cost of living for Canadians.

Statistics Canada reported Friday that just about every part of the economy added jobs last month, including the manufacturing, construction, accommodation and food services industries.

The hiring surge was more than enough to offset the jobs lost between May and September of this year. Virtually all the net new jobs were full time and almost three-quarters of them came from the private sector. That's the first time that's happened since March.

Despite the surge, Canada's jobless rate held steady at 5.2 per cent. "But this was due to many more Canadians looking for work," TD Bank economist Rishi Sondhi said of the data. "[That's] a healthy sign for growth."

Where the jobs were gained and lost last month

Wage gains picked up the pace, too, with the average hourly income hitting $31.94 during the month. That's up by 5.6 per cent over the year prior.

While wage gains are good news for workers, they are a double-edged sword for the Bank of Canada, which is trying to wrestle inflation into submission. Higher incomes will add to the inflationary pressure on spending, possibly compelling the central bank to raise interest rates even more than they already have.

"Up until this point, wages hadn't looked particularly worrisome in Canada," said economist Royce Mendes, with Desjardins. "But the more this measure heats up, the more pressure will be on the Bank of Canada to continue its rate-hiking cycle for longer than it previously anticipated."

'Everything is going up'

Despite these gains, more and more households are reporting having a hard time keeping their heads above water.

More than a third of households reported "difficulty meeting financial needs" during the month. Two years ago, only one in five said that.

CBC
CBC

Charlene Comeau, of Winnipeg, is one of them. She and her husband both have full-time jobs to support their family of five, but she's been looking for a second job to help pay the bills.

"At this point, I'm feeling like I need to get another job … part time, just to alleviate the pressure a little bit," she told CBC News in an interview.

Her employer tends to give out raises once a year, and while she got one this year, she said it wasn't enough to offset the huge uptick in prices for things like food, gasoline and keeping a roof over the family's head.

"We work — and my husband and I think we're secure — but the way that everything is going up … we do feel like we need to do more."

Two-thirds of people making $40 an hour reported getting a raise in the past year. That compares with about half of those making $20 or under.

That suggests a job market that is moving in two different directions, said economist Tu Nguyen, with consultancy RSM Canada.

"The people who are lower income, who struggle the most, are not getting the gains as they need, whereas those who maybe have some more buffer to absorb higher inflation and higher prices keep getting raises," she said in an interview.

"When individuals and households who earn more, make more, they go out and they spend more and that increases demands for goods and services so inflation keeps staying high," she said.