BMO Bank of Montreal
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BMO Bank of Montreal

November 03, 2011 08:08 ET

BMO Economics: Cautious Optimism for Canadian Jobs in October

TORONTO, ONTARIO--(Marketwire - Nov. 3, 2011) - Ahead of the Canadian Employment Report that will be released tomorrow, BMO Deputy Chief Economist Doug Porter is projecting a modest increase of 15,000 jobs for the Canadian economy, with strong performances and growth anticipated for a few industries.

"We project total employment growth for October will be 15,000 – an increase of 0.1 per cent – which should keep the unemployment rate at 7.1 per cent," said Douglas Porter, Deputy Chief Economist, BMO Capital Markets. "Underlying labour demand likely cooled amid the recent rise in economic uncertainty and softer business confidence, leading to slowing employment growth. However, we expect to see strength in the finance, insurance, real estate and leasing industries after weak September numbers, and we anticipate growth in the healthcare and social assistance sectors."

Mr. Porter noted that the Canadian job market has delivered a rare bit of good news in 2011, with the economy producing more than 250,000 net new jobs in the first nine months of the year (28,000 per month). That's roughly in line with the gains in the same period of the prior year. "This solid job growth has outpaced the growth in labour force, helping cut the unemployment rate by half a point since the start of 2011 to 7.1%. Job gains in 2011 have been led by hotels & restaurants, health care, education and construction – these four sectors alone have accounted for 90 per cent of the employment growth this year."

The forecast suggests cautious optimism among businesses in Canada. A BMO survey measuring confidence among Canadian businesses revealed:

  • 51 per cent of Canadian businesses believe 2012 will be a better year than 2011, and only 13 per cent expect it to be worse. Almost 80 per cent of Canadian business owners also plan to invest the same amount or more into their business in 2012.
  • For those that plan to invest in their business, 39 per cent plan to hire more employees, while another 31 per cent will invest in employee training.

"While the recent economic uncertainty has likely been a concern for business owners in Canada, companies north of the border have not been faced with the same pressure for job cuts as their American counterparts, so there remains cautious optimism for the year ahead," said Cathy Pin, Vice President, Commercial Banking, BMO Bank of Montreal.

BMO Financial Group is celebrating its 194th anniversary today.

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