Article source: ConstructConnect

Similar to what has been occurring in the United States, labour market conditions in Canada have remained robust despite significant hikes in interest rates orchestrated by the nation’s central bank. April’s nation-wide total jobs count north of the border rose by +41,000 according to the latest Labour Force Survey conducted by Statistics Canada.

The seasonally adjusted ‘headline’ unemployment rate stayed at the 5.0% level where it’s been for five months in a row. The not-seasonally adjusted (NSA) unemployment rate calculated using the same methodology as is adopted in the U.S., known as the R-3 U rate, is perhaps more relevant. In April, R-3 was 4.2%, only a little above the comparable U.S. figure of 3.1%. Graph 1 shows how closely the Canadian and U.S. U rates have been aligned going back at least ten years.

Through the beginning one-third of this year, the average monthly increase in total employment in Canada has been +62,000 jobs. From January to April of last year, the average monthly climb was almost the same, +61,000 jobs.
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Article source: ConstructConnect

Once again, there was no dramatically negative change in the U.S. labor market statistics contained in the latest monthly Employment Situation report from the Bureau of Labor Statistics (BLS). Quite the opposite. In April, the total number of jobs in the economy rose by +253,000 and the seasonally adjusted (SA) unemployment rate stayed extremely low, at 3.4%.

In March 2023, the SA U rate had been 3.5%, and in April 2022, 3.6%. The not seasonally adjusted (NSA) unemployment rate in the latest month was a barely-there 3.1%.

The continuing strength in jobs creation having been noted, there is another story that needs telling. It is hard to find a consistent narrative in the reported U.S. employment numbers.

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Article source: ConstructConnect

What’s that you say? There’s a ‘bull’ stock market underway! Yes, indeed, and it seems hard to believe, given that we were talking about ‘bear’ market conditions only a few months ago. A ‘bull’ is a gain of +20% or more in an index from its 52-week low and a ‘bear’ is a drop of -20% or more from its 52-week high.

As of its April 2023 month-end closing value, NASDAQ had fulfilled the requirement to be designated a ‘bull’ market, since it was +21.2% relative to its 52-week bottom touched on October 13, 2022. Both the DJI and the S&P 500 also had their recent nadirs on October 13 of last year and are now almost in bull territory, at +19.0% and +19.4% respectively.

Nearly every day, it seems, there is an announcement from some major company about significant job cuts that are taking place or are being planned. With such a background, what is it about the economy overall that is putting investors in a better mood?

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Article source: ConstructConnect

Much of my work-related conversation over the past year-plus has concerned the preponderance of mega-sized construction projects being green-lighted in the United States. A ‘mega’ is defined as a project carrying an estimated value of a billion dollars or more.

Spurred on by government incentive measures, a desire to bring jobs back to America from overseas, and target dates for drastically reducing carbon emissions, there has been an explosion of activity in ‘starts’ on industrial/manufacturing projects, as is captured in Graph 1 below.

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