Canada’s Economy Is Doing OK (Just Don’t Ask About Alberta)

It's been a nice quiet summer (read: boring) in Canada so far this year. The country is up about 11,000 jobs in July, which is down from the 45,000 or so added in June. The country gained roughly 35,000 full-time jobs this month, but was offset by the loss of more than 24,000 part-time positions. Despite this month's slower employment gains, including a larger-than-anticipated trade deficit of $3.6 billion, July marks the eighth consecutive month of economic growth in Canada.

The unemployment rate now sits at 6.3 percent, which is the lowest we've seen since October 2008—just before the Great Recession came into full swing. A large part of this happy number comes from people dropping out of the workforce, but hey: don't look a gift horse in the mouth.

The biggest employment gains this July came in Ontario and Manitoba, which saw respective increases of 26,000 and 4,800 jobs. Alberta shed 14,000 jobs in the same period, although compared to July 2016 the province has seen an overall increase of 35,000 positions largely thanks to gains in the natural resources sector. Meanwhile, Newfoundland and Labrador sloughed off 5,300 jobs, continuing a long-term downward trend which has brought unemployment in the province up to 15.7 percent, marking a total decline of 13,000 positions since this time last year.

Also worth noting is the fact that more Canadians above the age of 65 are participating in the labour force than at any time since the late 1960s. Between the country's aging population and the retreat of both public and private pension plans, this will be a trend to watch.

Overall, this is all good—if modest—news for the Canadian economy. But there are also some clear caveats: growth is slowing down, so it's a bad time for anyone to get too relaxed. The disparity between the rest of the country and the deteriorating situation in Newfoundland and Labrador is also more than a little troubling, since there is no reprieve for the Rock's woes in sight. The full impact of the Bank of Canada decision last month to raise interest rates has yet to be felt, and there may be another hike forthcoming in October. There are also the perennial worries about hiccups (or worse) in the national housing market or Canada's dizzying personal debt-to-income ratio, but that's nothing to worry about until they come to foreclose on your house.

But why worry about an economic winter when it's still pretty warm and sunny out? Eat, drink, and be merry: for now, everything's cool.

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