Employers in both Canada and the United States increased hiring in March after a winter in which they were reluctant to expand their payrolls. March employment increases in both countries suggested employers were feeling more confident about their business prospects. They showed that efforts in both countries to support economic recovery were producing the desired results.
Canada's labour force survey for March showed employment increased by 43,000 over the preceding month. Employment among young workers ages 15 to 24 accounted for 33,000 of the increase. This surge in youth employment helped ease fears that young people, entering the market at a time of slow economic growth, were condemned to a long wait before they could reach the bottom rung of the career ladder.
The unemployment rate for March was 6.9 per cent, down 0.1 per cent from February. Unemployment has been slowly declining from its high point of 8.7 per cent five years ago, but the improving trend appeared to stall in the late months of 2013. The March figures restored the trend of gradual recovery from the 2008 financial crisis and from the economic slowdown that resulted.
In the U.S., employment rose by 192,000 in March and the unemployment rate remained unchanged at 6.7 per cent. Average monthly growth of employment in the preceding 12 months was 183,000. The March result therefore felt like a small acceleration in employment growth. All the growth in March occurred in the U.S. private sector, which lost 8.8 million jobs in the 2008-09 recession and has now recovered 8.9 million jobs from the low point. U.S. recovery has, to that extent, brought the job market back to where it stood in 2007, before the recession.
In the U.S., where Congress is paralyzed by partisan warfare, support for economic recovery has come primarily from the Federal Reserve Board and its policy of cheap, abundant credit. In Canada, stimulus came mainly from the government while Jim Flaherty was minister of finance. He cut taxes and ran budgetary deficits throughout his years in office in order to support growth.
The March employment reports should encourage Joe Oliver, the new minister of finance, and Janet Yellen, the new U.S. Federal Reserve chief, to believe the medicine is slowly working and the patients are recovering.