Unemployment rises, full-time work drops despite rise in overall Alberta job numbers

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Alberta may be in a recession this year but the province continues to add jobs at one of the highest rates in the country.

However, there are some growing concerns about Alberta’s labour market.

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Employment was up in Alberta in September, with 12,300 new jobs in the province — but the gains were all in part-time work and the city’s unemployment rate rose as more people entered the labour force, Statistics Canada reported Friday.

Overall job numbers rose 0.5 per cent from August after the province gained 35,800 part-time jobs. But full-time employment dropped 1.2 per cent from August, as the number of positions declined by 23,500.

Alberta’s unemployment rate climbed 0.5 points to 6.5 per cent, reflecting a rise in the number of people looking for work.

On a year-over-year basis, employment in Alberta was up 1.4 per cent to 31,000 jobs. Most of the gain (24,900) was in part-time work, though there were 6,200 new full-time jobs as well. Despite those gains, the unemployment rate was up 1.9 percentage points from September 2014, due to a larger labour force.

In the Calgary census metropolitan area, there were 2,400 new jobs, up 0.3 per cent from August, as the unemployment rate rose from 6.6 per cent to 6.8 per cent. Year-over-year, the Calgary region has created 17,600 new jobs, up 2.2 per cent.

Todd Hirsch, chief economist with ATB Financial, said that while the employment report is surprising a closer look at the data reveals “that the job situation is actually quite fragile” as there was a huge swing away from full-time jobs to part-time positions.

“Also, because of a sharp increase in the size of the labour force — which is the number of people age 15 and over who are working or looking for work — the unemployment rate jumped half a percentage point to 6.5 per cent. This is the highest rate since June 2010 when the province was crawling out from under the last recession,” said Hirsch. “Even more revealing is the mix of new employment by industry. There continues to be general weakness in the resource sector, which is down nearly 28,000 jobs compared to a year ago. Manufacturing — much of which feeds directly into the oil and gas sector such as steel pipe, specialized equipment or refined oil products — is down about 11,000 jobs year-over-year. Professional, scientific and technical occupations are also down 11,000 jobs.

“More than offsetting the job losses in the resource sector are strong advances in other sectors. Retail and whole trade, health care and social assistance, and public administration are, as a group, up almost 48,000 from a year ago — an increase of seven per cent. However, most of these are lower paying jobs than those in oil and gas, and many may be part-time.”

Mary Moran, president and chief executive of Calgary Economic Development, said the city reached an unemployment rate of 7.5 per cent back in early 2010.

“We’re still not at that rate. I think that’s a good news story,” she said, adding the current unemployment rate is surprisingly better than she thought it was going to be. One of the contributors to that is a growing labour force as the city added about 3,900 people in September.

Moran said the city is losing jobs in energy and energy-related sectors but overall the city still is up 9,400 jobs in 2015.

“We expect the fall to be a difficult period. We know we’re heading into a headwind,” she said, adding the job losses in the energy industry are being offset by other industries. Transportation and logistics has added 3,100 jobs year-over-year. Healthcare and social assistance is up 20,000 jobs, or 26 per cent, from a year ago.

Alberta’s unemployment rate is now the fourth lowest in Canada, behind Saskatchewan’s 5.1 per cent, Manitoba’s 5.2 per cent and British Columbia’s 6.3 per cent.

The Alberta government said the unemployment rate increased from the previous month because the labour force increased by 26,300 people.

The following industries had the most employment increases in September from the previous month: Trade, 6,400; Business, Building and Other Support Services, 5,100; and Educational Services, 4,200. The industries with the most employment decreases over the same period were: Transportation and Warehousing, 6,500; Finance, Insurance, Real Estate and Leasing, 5,100; and Accommodation and Food Services, 4,600.

Robert Kavcic, senior economist with BMO Capital Markets, said Alberta managed a solid job gain in September despite its economic challenges.

“This is where things get a tad suspicious,” he wrote in a research note. “For one, pubic-sector employment is up a massive 11.5% y/y (doesn’t seem right or sustainable), and Canada’s other employment (payrolls) report had Alberta at the bottom of the pack as of July, down 0.6% y/y. The moves in the unemployment rate and payroll employment look like a better reflection of what is truly happening in Alberta’s labour market.”

Nationally, Statistics Canada said employment was little changed for the fourth consecutive month in September as it grew by 0.1 per cent of 12,100. The unemployment rate increased by 0.1 percentage points to 7.1 per cent as more people participated in the labour market.

The federal agency said part-time employment rose by 74,000 in September, which was largely offset by a decline of 62,000 in full time.

Year-over-year, employment in Canada is up by 0.9 per cent to 161,200.

In the natural resources sector, 2,600 jobs, or 0.7 per cent, were lost in September while employment is down 20,300 positions, or 5.4 per cent, from a year ago.

mtoneguzzi@calgaryherald.com

Twitter.com/MTone123