CIBC On Jobs Report, Watching Involuntary Part-Time

CIBC offer a consensus view for Friday’s employment report, with 20k employment change and the u/e rate ticking up a tenth to 5.1% in May.

• Rapid population growth is creating a larger pool of potential workers, but cooling demand due to past interest rate hikes should see employment gains start to undershoot population growth.
• While 20K in jobs would have previously been considered solid, in 2023 it’s likely weak enough to see the u/e rate rise a tick to 5.1%.
• The BoC’s latest benchmarks for assessing labour market health try to break down demand and supply factors, with one demand-side area they are looking at being the proportion of workers involuntarily in part-time jobs.
• This has been edging up closer to pre-pandemic norms in recent months, and it appears that policymakers are looking for a continuation of that trend as a signpost that demand for staff is easing, even if the headline unemployment rate remains low.