CANADA ECONOMICS: Desjardins Previews Friday's January Jobs Data; Eyes on Hours Worked
08:12 AM EST, 02/05/2021 (MT Newswires) -- Desjardins said that in Canada the market consensus for the January Labour Force Survey (LFS) was for a 40,000 jobs decline and it was subject to downside risk given the COVID-19 lockdowns in the labor-intensive sectors in the provinces of Quebec and Ontario.
Canada will release the January LFS at 8:30 a.m. ET on Friday.
The bank's economists broke rather radically from consensus this month and expect a 300,000 drop. The December survey week was early in the month given the holidays, whereas stiffer lockdown announcements came in towards the end of the month.
That meant that the January estimate will be the one reflecting these measures, added Desjardins. With many sectors already heavily restricted, there won' be as many jobs to shed this time around.
The accommodation and food sector was already affected by measures, and employment had started to decline in October. Retail/wholesale looked more at risk of losing a portion of the more than 500,000 jobs recovered since last April following the announcements in Ontario and Quebec.
In this sector, these two provinces accounted for over 60% of total employment. In-person schooling interdictions was another factor that will weigh on employment, particularly among women in the 25-54 age range.
All this said, the wage subsidy program was an important wildcard that could alter the extent of weakness, and overall, the bank would emphasize hours worked as a better measure of job market performance for these kinds of circumstances.