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Canadian jobs market continues to rebound
Canada's jobs market continues to rebound from the recession, creating another 25,000 jobs last month with a sharp jump in full-time positions. Full-time employment rose by 67,000 in May, Statistics Canada said this morning, while part-time work declined by 43,000. The jobless rate held steady, though, at 8.1 per cent. The federal statistics gathering agency noted that jobs have increased to the tune of 310,000, or 1.8 per cent, since the labour market began turning around in July, 2009. Even more importantly, the bulk of those gains have been full-time positions.
"Overall, the services sector continues to be the main driver of jobs in Canada, accounting for over three-quarters of the jobs created since August," noted CIBC World Markets economist Krishen Rangasamy. "The tilt towards services has become more pronounced over the course of the recovery, with that sector accounting for 87% of total jobs created in the first five months of this year versus 55% in the last five months of 2009."
Some other key points:
- Since last July, jobs in the private sector are up by 2.8 per cent, and the public sector by 2.2 per cent.
- Industries that chalked up the biggest gains last month included transportation, health care, public administration and agriculture. Losers included culture and recreation, accommodation and food services, and natural resources.
- Ontario, Alberta, Nova Scotia and Newfoundland and Labrador created jobs, while British Columbia and Prince Edward Island lost work.
- Women 55 and older accounted for the bulk of the national growth. Since last July, employment among men over 55 has jumped 5 per cent, while jobs for women in the same age bracket have increased by 3.1 per cent.
- The summer job market for students also started well, Statistics Canada said. "There were 54,000 more students aged 20 to 24 employed in May," the agency said.
"All said, the latest employment data confirm a relatively strong domestic economic recovery that has begun to mature - where incremental gains diminish while becoming self-sustaining," said Toronto-Dominion Bank senior economist Pascal Gauthier. Read the story
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U.S. jobs disappoint
Global financial markets slumped today after the widely watched U.S. jobs report for May fell flat with investors. The U.S. dollar sank, along with oil prices , while the Canadian dollar lost more than three-quarters of a penny. The Dow Jones industrial average , the S&P 500 and the S&P/TSX composite were all down after the U.S. Labour Department reported that the economy created 431,000 jobs in May, less than expected and skewed by the fact that 411,000 of them came from temporary hiring of census workers. The private sector created only 41,000 jobs. The unemployment rate fell to 9.7 per cent from 9.9 per cent.
"Yes, the result was disappointing," said BMO Nesbitt Burns senior economist Jennifer Lee. "But expectations were very high and this is one month and one month doesn't make a trend. The various surveys ... are showing gains or just general improvement. Jobs are indeed being created and at this point, that is the most important takeaway." Read the story
Flaherty urges focus on bank risk
Finance Minister Jim Flaherty wants to ensure his counterparts at the G20 meeting in Busan, South Korea, aren't pushed off course by deep divisions over a global bank tax. Mr. Flaherty, among the finance ministers and central bankers at the two-day summit, wants officials instead to focus on preventing banks from making the risky choices that sparked the financial crisis. Some governments want a global bank levy, while Mr. Flaherty and Prime Minister Harper oppose such a move, arguing repeatedly that Canada's banks should not be punished, given how well they came through the crisis. It has become clear that the issue of a new levy is dead at the summit, since there is no consensus.
Read
Flaherty urges G20 not to be distracted by bank-tax row
Why Harper is taking his bank-tax fight to Europe's doorstep
Kevin Carmichael's G8/G20 Global View summit blog
New bank rules to be phased in
New international rules on bank capital will be phased in over a longer time frame than first proposed. G20 finance officials had planned to put the new regulations in place by the end of 2012, but it appears global regulators will take into account the lobbying of the banks to delay what are known as the Basel III regulations, which will lead to higher capital levels among financial institutions. "Some would like a shorter period, some would like a longer period," Finance Minister Jim Flaherty told reporters at the G20 meeting of ministers and central bankers in Busan, South Korea. "... There can be a compromise on that." Read the story
UBS cuts RIM price target
UBS Securities today shaved $5-a-share from its 12-month price target on Research In Motion Ltd. shares, citing what could be heightened competition on the enterprise, or business, side from the iPhone from Apple Inc. UBS cut the target to $70 from $75, leaving its earnings-per-share estimates largely unchanged for 2011 but slightly lowering its expectations for 2012 to $5.32 from $5.37.
"Near-term, we expect Apple to announce its [next generation]iPhone on Monday and believe Apple may cite increasing enterprise traction which could pressure [RIM](we believe fears over Europe are also weighing," UBS analysts Phillip Huang and Maynard Um said in their report. "... Checks indicate increasing interest in some alternative enterprise e-mail solutions, though we don't expect RIM to be materially impacted over the next 12 months. Although visibility at this point remains limited and new competition broadly unproven, we believe a number of market factors could potentially open the door to the first credible challenges to RIM's enterprise dominance."
BP hopes to capture bulk of leak
BP PLC hopes a cap it installed last night will allow the energy giant to collect more than 90 per cent of the oil spewing into the Gulf of Mexico from its undersea disaster. "That's possible with this design," the company's chief operating officer for exploration and production, Doug Suttles, told CBS today. "We have to work through the next 24 to 48 hours to optimize that."
BP officials also told analysts today that the company can bear the costs of containing the leak and cleaning up its mess and still maintain its hefty quarterly dividend. BP shareholders have watched as their stock lost tens of billions of dollars in value since the explosion on the Deepwater Horizon drilling rig several weeks ago, and have feared the loss of the dividend. Read the story
Related: BP under pressure to cut dividend
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G20 summit forces Bay Street to move house