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Quebec and Ontario Economic News

Quebec’s Job Market Levels Off in January

February 9, 2024
Florence Jean-Jacobs
Principal Economist

Highlights

  • Quebec employment edged down in January (-7,500), due to a steep decline in part-time work that outpaced gains in full-time jobs (see table).
  • The reduction in the number of people looking for work brought unemployment down 0.2 points to 4.5% in January.
  • The employment rate dropped sharply over the past year (from 62.5% to 61.6%) due to a combination of flat employment and solid growth in the population aged 15 and older (+1.9%).
  • The participation rate (64.5% in January) has plunged to its lowest since October 2022, as the labour force shrunk considerably (-20,400 people month-on-month). This is the biggest slump in participation since January 2022 (-41,800).
  • Hours worked continued to flag (-0.6% compared to January 2023), even though teachers went back to work in January. Average hourly wage growth slid once more, from 3.6% in December to 3.3% in January on a year-over-year basis.

Comments

Although the strike in the public sector reduced the number of hours worked in December compared to the year before, we expected the end of the strike to push the numbers back up in January. That was not the case.

Construction, health care, and accommodation and food services posted the biggest job losses in January (table). But wholesale and retail trade wiped out their losses from the previous month, as did educational services. 

Implications

After decelerating in the fourth quarter of 2023, the job market continued to slow in January. The private sector has lost 16,400 jobs over the past 6 months, compared to gains in the public sector (+52,500).

We'll need to keep a close watch on participation and employment rates in 2024. A growing number of people have left the job market in recent months, even though the working-age population is rapidly increasing. On a month-on-month basis, it grew by a record 0.24%, a rate not seen since this data started being collected in 1976. This is the first time in 16 months that annual labour force growth fell below that of the working age population. And, over the past 3 months, annual employment growth hasn't kept up with the increase in the population aged 15 and older (graph). 

All told, the January print has confirmed that Quebec's economy is losing momentum. We expect this trend to last for another few months, but the province will likely be spared a severe recession (see our most recent forecasts xternal link.).

NOTE TO READERS: The letters k, M and B are used in texts, graphs and tables to refer to thousands, millions and billions respectively. IMPORTANT: This document is based on public information and may under no circumstances be used or construed as a commitment by Desjardins Group. While the information provided has been determined on the basis of data obtained from sources that are deemed to be reliable, Desjardins Group in no way warrants that the information is accurate or complete. The document is provided solely for information purposes and does not constitute an offer or solicitation for purchase or sale. Desjardins Group takes no responsibility for the consequences of any decision whatsoever made on the basis of the data contained herein and does not hereby undertake to provide any advice, notably in the area of investment services. Data on prices and margins is provided for information purposes and may be modified at any time based on such factors as market conditions. The past performances and projections expressed herein are no guarantee of future performance. Unless otherwise indicated, the opinions and forecasts contained herein are those of the document’s authors and do not represent the opinions of any other person or the official position of Desjardins Group.