Canada's economy added 14,000 jobs in March, or 0.1% month over month, which is more-or-less in line with consensus expectations for a 15,000 gain, said TD after Friday's Labour Force Survey (LFS).
Employment was essentially flat across job types, with full-time employment edging down slightly, or 1,000, while private-sector employment rose by 15,000 on the month.
The unemployment rate was unchanged at 6.7% after February's increase. The labor force grew by 15,000 in March, while the participation rate was unchanged at 64.9%.
The data suggests that the high unemployment rate is "mostly driven by slower hiring, rather than by increased layoffs."
The LFS came in as expected, showcasing the lack of dynamism in the Canadian labor market, stated TD. The unemployment rate remains elevated, with the lack of hiring showcasing the general apprehension in the economy. With the economy continuing to progress in fits and starts, and uncertainty sky-high, the outlook is for subdued job growth and a steady unemployment rate.
The outlook remains "fraught," with the energy shock beginning to be felt in the Canadian economy, and no clarity on the direction of the conflict, added the bank. How long the Middle East conflict lasts and energy supplies remain disrupted will determine the size of the inflation shock.
For now, weak demand conditions should provide some offset to inflationary pass-through, allowing the Bank of Canada to stay on the sidelines and wait to see how things play out, according to TD.