Canada Net Change in Employment Preview: Seven major banks expectations for June jobs report

Today, the Canadian jobs report for June is due to be released at 12:30 GMT and as we get closer to that time, here are the expectations forecast by the economists and researchers of seven major banks regarding the upcoming employment data. Most of the market specialists are expecting Net Change in Employment to post-reading in between +450K million and +1 million in June, while the consensus is +700K reading. In addition, the unemployment rate is expected to fall to 12% from 13.7%.

NBF

“The recovery in employment probably accelerated during the month as the economy gradually reopened. We are calling for a +1 million print. Such gains would lead the unemployment rate to decrease from 13.7% to 11.6%, assuming the participation rate rose further to 63.0%.”

CIBC

“A month ago the Labour Force Survey revealed a nice surprise in the form of an earlier than anticipated return to net hiring. As restrictions were further eased, the data for June will likely build on those green shoots, with roughly 700K jobs expected to have been created during the month, helped by Ontario’s reopening. Moreover, the number of hours worked by employees that had seen shifts cut due to the pandemic will likely also paint a clear picture of a turnaround. Supporting the view that June will further build on the growth seen in May, applications for income-support have slowed materially relative to the depths of the crisis.”

BMO

“For employment, Canada has roughly mimicked the US experience recently, with the old 10:1 rule holding up remarkably well during this period of extreme economic volatility, and we expect that to continue in June with a job gain of 450K. Even in the event of a strong job rise last month, we still expect Canada’s unemployment rate to stay high at nearly 13%. If correct, that would leave the jobless rate more than 7 percentage points higher than a year ago, roughly similar to the net deterioration seen in the US job market.”

RBC Economics

“We’re expecting a rise of 650K jobs, a little more than twice the 290K increase in May. That should be enough to push the unemployment rate a tick lower, despite a bounce-back in labour force participation. And growth in hours worked should outpace employment growth after underperforming during the March/April downturn. That increase should reinforce expectations that the economy grew once again in June.” 

TDS

“The pace of hiring should accelerate in June with 600K jobs added across the Canadian economy, leaving the unemployment rate to drift lower to 12.2%. We will also be focused on the total hours worked which will give insight into economic activity for June.”

ING

“The Canadian jobs report last month followed the US in delivering a surprising jump. Inevitably, this is keeping expectations for the June report quite high after this Thursday’s US numbers. A rise in employment above 500K may provide support to the Canadian dollar, although the impact may be relatively short-lived with questions likely to be raised about the reliability of the report and the true unemployment numbers, as seen in the US.”

Citibank

“Citi analysts expect a strong rebound in employment of 900K jobs in June following a somewhat surprising ~300k increase in May. That said, there is considerable uncertainty around the magnitude of job growth with these expectations are partly based on trends seen in US employment data. They also expect the Unemployment Rate to fall to 10.9% from 13.7%.”