Due at 1330 GMT Friday 9 February 2018, data for employment change, the unemployment rate, participation rate the split between full and part time jobs added

Previews:

Bank of Montreal:

After back-to-back blowout employment reports, we'll see if the momentum was maintained into 2018.

  • Given underlying economic growth of around 2%, job growth likely decelerated in January to a more normal 20,000. However, since there are no leading indicators to work with, it would not be shocking to see a big swing either way.
  • November and December saw the second biggest two-month job gain in over 40 years, with employment declining in the month that followed the only larger gain in 2012. The rise in employment was broad based in December, leaving no industry ripe for reversal.

One of the more impressive aspects of the recent labour market data has been the 0.4 ppt plunge in the jobless rate over the past two months.

  • There's probably a greater risk of some reversal rather than a further decline.

January brought a 20.7% minimum wage hike in Ontario, which, combined with softness in January 2017 and a firming labour market, is expected to push wage gains sharply higher to 3.5%, marking the fastest pace in over 5 years.

  • Notably, the BoC's Labour Market Indicator (LMI) is still showing some slack, so we'll be watching for an improvement in that measure despite being little changed the past two months even with the solid job reports.

Note that there's no clear seasonality around this month's print, beating/missing expectations about half the time since 2000.

CIBC:

It will be a fraction of the prior month's increase, but a 13K gain will be enough to keep the unemployment at a historically low 5.8%. (Annual revisions added a tick to the previously reported 5.7% rate.)

  • Indeed, January's more modest increase will in part be a sign of things to come in 2018, with a slower path to job gains coming as we edge ever closer to full employment.

The offset for consumer pocket books could come from firmer wages.

  • We've already seen the pay rate measured in the LFS move higher, although the Bank of Canada has outlined a new measure that is stacking up to only 2.2%.
  • Look for the LFS measure, and the BoC's new metric, to accelerate in the months ahead.

Job growth was phenomenal in 2017, and will still be pretty good in 2018. Although average annual growth will benefit from the strong hand-off seen over the past few months, the monthly pace will be roughly half of last year's trend.