Canadian Employment Preview: Six major banks expectations for August jobs report

Today, the Canadian jobs report for August is due out at 12:30 GMT and as we get closer to that time, here are the expectations forecast by the economists and researchers of six major banks regarding the upcoming employment data. Most of the market specialists are expecting Net Change in Employment to post-reading in between +225K and +400K in August, while the consensus is +275K reading. In addition, the unemployment rate is expected to fall to 10.1% from 10.9%.

ING

“Our economics team is expecting headline employment to rise by 400K in Canada, matching the July increase, and the unemployment rate to edge lower to 10.0%.”

TDS

“The labour market recovery should lose some steam in August with 225K jobs created, down from the 680K averaged over June/July, which should allow the unemployment rate to drift lower to 10.2%. This reflects a pause in re-opening measures, although the continued improvement in mobility and benefits data point to another strong month for job growth.” 

NBF

“We are calling for a +225K print. Such gains would lead to a decrease in the unemployment rate from 10.9% to 10.1%, assuming the participation rate rose further to 64.5%.”

RBC

“The 250K increase in employment we expect in August is down from the 400K increase in July and would still leave the overall jobs count down by about a million from February – a shortfall that is still more than twice the total job losses in the 2008/09 recession. The unemployment rate could stay in double-digit territory for another month, declining to 10% from almost 11% in July. But that measure – while already historically elevated –is still understating the weakness in the current labour market. Though jobs have rebounded substantially from April lows, a large number of people returning to work have been doing so at reduced hours. Around 345K of the 419K increase in July employment came from part-time jobs – and more than a third of those gains were involuntary (that is, these employees would prefer to be working more hours.) Meantime, demand for services – especially those in the hard-hit travel sector – remains very soft. There were still over 400K fewer jobs in accommodation & food services and entertainment in July compared to February – and those jobs will be among the slowest to return as long as the virus threat continues to restrict tourism.”

CIBC

“Canada’s ability to keep virus cases low in August meant that the labour market had yet to hit any major stumbling blocks in its quest to recover lost ground. As a result, expect the employment data to show another solid gain in jobs, although the pace likely tailed off further. There were simply far fewer businesses reopening their doors and calling back workers than in prior months. According to some sources, job postings continued to track well below a year ago levels, roughly down the same amount year-over-year as they were in July. There also continued to be well-above normal levels of job loss according to the data on new CERB applicants, although those include some who remain employed but have lost income. That suggests that, while the economy in aggregate was clearly healing, there was still significant pain being felt in some parts. All in all, we expect the Canadian economy to have added 250K positions and the unemployment rate to be at 10.6%.”

Citibank

“Canada’s employment should gain again, 310K jobs this month, continuing a 3-month streak of job gains reversing some 55% of the decline in jobs over March and April. Still, the path of employment later is much more uncertain. We also expect the unemployment rate to come in at 9.9%.”