Wage growth hit its highest level in nearly six years last month as the economy posted a slight net loss of 1,100 jobs and an unemployment rate that held steady at 5.8%.

Statistics Canada released a new jobs report Friday that showed average hourly wages in April were 3.6% higher than they were a year earlier. It was the monthly reading’s largest annual increase since October 2012.

The indicator, which is closely monitored by the Bank of Canada ahead of its interest-rate decisions, posted an annual increase of 3.3% in March.

Signs that wage growth is strengthening could nudge the central bank closer to raising its trend-setting rate. The bank’s next rate decision is scheduled for May 30.

Overall, the decline in jobs last month was so small the federal agency did not consider it statistically significant.

Read: The story behind Canada’s labour market trends

The unemployment rate stayed at its record low of 5.8% for a third-straight month. It matches its lowest mark since the agency started measuring the indicator in 1976.

The participation rate, however, edged down in April to 65.4%, from 65.5% in March, as fewer people looked for work.

The agency said the economy produced 28,800 full-time jobs last month and shed 30,000 part-time positions. The country also saw a decrease of 13,600 positions in the country’s public sector, while the number of private-sector jobs rose by 28,000.

The goods-producing sector shed 15,900 positions, mostly in construction. Services sectors, meanwhile, created 14,800 jobs following big increases in professional, scientific and technical services as well as accommodation and food services.

The youth unemployment rate increased in April to 11.1% following a net gain of 17,700 new jobs. The labour force participation rate for youth slipped to 63.4% from 63.8%.

Compared with 12 months earlier, employment was up 1.5% following the creation of 278,300 jobs, which was fuelled by 378,300 new full-time positions.

“Canadian employment disappointed on the headline, but the details were fairly solid and shouldn’t do much to change expectations regarding the Bank of Canada and future rate hikes,” said Andrew Grantham, senior economist at CIBC Capital Markets, in a note. CIBC is forecasting an interest rate hike in July, added Grantham.

Also read:

Surge in full-time jobs holds Canada’s unemployment rate steady

U.S. unemployment dips to 3.9% as 164,000 jobs added

Originally published on Advisor.ca
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