Victoria’s unemployment rate increased slightly in July, but remains one of the lowest in the country, according to Statistics sa国际传媒’s monthly labour force survey.
The rate rose to 3.5 per cent last month from 3.4 per cent in June, while the province’s unemployment rate dipped to 5.4 from 5.6 per cent.
According to the national number cruncher, Victoria is now tied with Quebec City for the third-lowest rate in sa国际传媒, behind only Kelowna (2.8 per cent) and Sherbrooke, Que. (3.4 per cent).
Year-over-year, the total number of people employed in Victoria increased to 222,300 from 219,300 in July 2022.
Over that same 12-month period, Victoria’s accommodation and food services industry has added 5,300 workers, while business, building and support services added 3,300 positions and finance and real estate added 2,500.
Wholesale and retail trade, on the other hand, shed 3,600 positions in Victoria, while the manufacturing sector lost 2,500 jobs.
Nationally, the labour market is softening as the unemployment rate increased for a third consecutive month, offering some evidence the economy is finally slowing down.
Statistics sa国际传媒 said employment was little changed in July, falling by 6,400 jobs. Meanwhile, the unemployment rate ticked up to 5.5 per cent as the economy struggles to create enough jobs to match the pace of population growth.
The federal agency says job losses last month were led by the construction industry, while the greatest job gains were made in health care and social assistance.
May served as a turning point in the labour market: the unemployment rate rose for the first time in nine months. Prior to that, the unemployment rate was hovering at five per cent, just above the all-time low of 4.9 per cent reached last summer.
As sa国际传媒’s population continues to grow rapidly, rising unemployment signals the economy isn’t creating enough jobs to absorb a larger workforce.
“We’ve seen a consistent increase in the number of people without a job in sa国际传媒, but people that are still in the labour force,” said James Orlando, TD’s director of economics.
Job vacancies have also declined in the country, offering another sign that the labour market is loosening.
Orlando says high population growth is helping the economy stay afloat as newcomers add to demand. So instead of high interest rates leading to outright job losses, Orlando says the unemployment rate is rising.
“When people come to sa国际传媒, even if they don’t get a job right away, they’re consumers, right? They’re looking for housing, they need to buy food, they need to buy clothes. And so they’re buying stuff within the economy. And that is a demand shock,” Orlando said.
“It’s putting a floor under the economy at a time when most people would have thought it would be contracting.”
The Canadian economy has outperformed expectations this year, pushing the Bank of sa国际传媒 to raise interest rates again in both June and July.
BMO’s chief economist, Douglas Porter said the chances of a rate hike in September are falling.
“The soft July employment report is just the latest arrow in the quiver of signs that the economy is losing momentum. Along with the recent friendly CPI result, we believe that the case for the Bank of sa国际传媒 moving to the sidelines is now very strong,” Porter wrote in a client note.
