Weaker-Than-Expected October Jobs Report Keeps Jumbo Rate Cut in Play for December
October Jobs Report Highlights
Canada added only 14,500 jobs in October—well below the expected 27,200 increase, marking the slowest job growth of the year. The jobless rate remained steady at 6.5%, a bit lower than expected.
Potential December Rate Cut
With signs of a weaker labor market, the Bank of Canada may consider another rate cut on December 11. Swap markets suggest there's a 50% chance of a 50-bps cut, following last month’s aggressive reduction.
Participation and Employment Rates
The labor force participation rate hit 64.8%—its lowest since 1997, excluding the COVID period—while the employment rate fell to 60.6%, continuing a six-month decline. Aging population trends and fewer students entering the workforce have contributed to this drop.
Canada added only 14,500 jobs in October—well below the expected 27,200 increase, marking the slowest job growth of the year. The jobless rate remained steady at 6.5%, a bit lower than expected.
Potential December Rate Cut
With signs of a weaker labor market, the Bank of Canada may consider another rate cut on December 11. Swap markets suggest there's a 50% chance of a 50-bps cut, following last month’s aggressive reduction.
Participation and Employment Rates
The labor force participation rate hit 64.8%—its lowest since 1997, excluding the COVID period—while the employment rate fell to 60.6%, continuing a six-month decline. Aging population trends and fewer students entering the workforce have contributed to this drop.
Industry Breakdown
Provincial Updates
Housing Market
As the BoC reduces rates, housing activity is expected to increase significantly by spring 2025. October’s housing market saw early signs of this growth, with full data expected on November 15.
Bottom Line
Economists are split on whether the BoC will cut by 25 or 50 bps on Dec. 11. With the overnight rate still high, a reduction to 2.5% by next spring could further drive economic activity and housing growth.
- Growth: Business support services added 29,000 jobs (+4.2%) in October.
- Decline: Finance, insurance, and real estate shed 13,000 jobs (-0.9%).
- Public Sector: Public administration jobs dropped by 8,700 after months of growth.
Provincial Updates
- Alberta: Employment rose by 13,000, though the unemployment rate stayed at 7.3%.
- New Brunswick: Added 3,300 jobs, keeping the unemployment rate steady at 6.8%.
- Prince Edward Island: Lost 1,100 jobs, pushing the unemployment rate up to 10%.
Housing Market
As the BoC reduces rates, housing activity is expected to increase significantly by spring 2025. October’s housing market saw early signs of this growth, with full data expected on November 15.
Bottom Line
Economists are split on whether the BoC will cut by 25 or 50 bps on Dec. 11. With the overnight rate still high, a reduction to 2.5% by next spring could further drive economic activity and housing growth.
Alexander Gasenko - your trusted Toronto & GTA mortgage broker. Dominion Lending Centres Maple Mortgage Group Independently Owned & Operated — FSRA# 13415
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