The Canadian job market has never lost more part-time jobs - ever - than in January...
Canada's unemployment rate rose to 5.9% as total job losses for January dropped the most since 2009, but it was the 137,000 collapse in part-time jobs that stands out.
So what is driving this collapse?
Simple - Minimum Wage Hikes In Ontario.
Ontario raised the minimum wage 21 percent to C$14 ($11.26), making it the highest in Canada.
And as Reuters reports, the steep minimum wage increase that went into effect on Jan. 1 in Ontario, Canada’s most populous province, has had a rocky start as some employers cut workers’ hours and benefits to reduce its impact on the bottom line.
The provincial government, controlled by the Ontario Liberal Party, positioned it as a measure to improve the livelihood of workers in Ontario, home to the nation’s largest city, Toronto, and its capital, Ottawa.
Yet some employers responded by implementing hiring freezes, cutting hours of existing workers, eliminating paid breaks and boosting benefits costs.
Shocker - sending minimum wage costs soaring leads to less demand for low-skill employees?
Will they never learn?
Of course, some see a silver lining as average hourly earnings jumped 3.3% (vs 2.9% previous month) thanks to the min wage hike, the fastest pace since 2015.
But, it appears the minimum wage hike has sent more people 'out' of the work force as the participation rate plunges to its lowest since 1999...
As a reminder, The Bank of Canada hiked 'dovishly' in January...
The BOC also noted that "while the economic outlook is expected to warrant higher interest rates over time, some continued monetary policy accommodation will likely be needed to keep the economy operating close to potential and inflation on target."
We suspect that hike-trajectory may slow.
The reaction in the Loonie is quite chaotic...