Metro Kelowna employment numbers for June buck national trend – Kelowna News

Metro Kelowna bucked the national hiring trend in June, as the economy added 800 jobs and the unemployment rate fell by nearly half a percentage point.

The unemployment rate in the region fell for the fifth month in a row, registering at 3.9% after registering at 4.3% in May. The 3.9% level is the lowest since November and is down sharply from its last high of 5.6% in January.

Overall, the Canadian labor market stalled in June as the economy shed 1,400 jobs and the unemployment rate climbed to its highest level in more than two years, strengthening the case for further interest rate cuts by the Bank of Canada.

Statistics Canada said Friday that the jobless rate rose to 6.4% for the month, up from 6.2% in May, as the size of the labor force increased.

The June result was the highest reading for the unemployment rate since January 2022, when it was 6.5%.

The unemployment rate also fell across Thompson-Okanagan, falling to 4.8% in June from 5.1% in May.

BC lost just under 10,000 jobs in June, but its unemployment rate of 5.2% is the second lowest among the provinces and well below the national average.

“In the face of high interest rates and slower global economic growth, BC is holding steady,” BC Minister of Labour, Economic Development and Innovation Brenda Bailey said in a press release.

“We have created 72,300 jobs since June 2023. This month we have gained 5,000 jobs in the private sector. Compared to this time last year, BC private sector employment has increased by 47,700, the second largest increase among the provinces during this period.”

As for a possible rate cut, TD Bank managing director and senior economist Leslie Preston said financial markets raised the odds for a rate cut by the Bank of Canada in its July 24 decision after the jobs report.

“The Bank of Canada is not there to see Canadians lose jobs, but they want to see … a little cooler conditions in the labor market,” Preston said. “So this is certainly in line with what they’re looking for.”

The central bank cut its key interest rate last month for the first time since the early days of the pandemic. The bank’s policy interest rate stands at 4.75%.

Preston said TD was still projecting that the Bank of Canada would wait until September before cutting again, but noted that there are two key data points coming ahead of the July rate decision: the quarterly survey of the central bank’s business outlook and the June inflation report.

“Certainly inflation is going to be big, but I wouldn’t want to downplay the business outlook survey,” Preston said. “That’s also a pretty important thing.”

BMO chief economist Doug Porter said the jobs report drives home the point that the Canadian labor market can no longer be considered tight and is tipping in the other direction.

“We learned last week that the job vacancy rate has fallen below pre-pandemic levels and the unemployment rate is now marching steadily higher on weak ground,” Porter wrote in a report.

“As a standalone result, the softening labor market increases the chances of a Bank of Canada rate cut. However, wages remain the very definition of climbing, which will give the bank pause.

Average hourly wages among workers rose 5.4% year over year in June.

— with files from The Canadian Press