Canada's labour market has been exhibiting considerable mood swings of late, and may well have closed out 2012 with one of the weakest showings in years for a non-recession period.
Economists expect Statistics Canada to report this morning that the economy created about 5,000 jobs in December and that the unemployment rate inched up to 7.3 per cent from 7.2 per cent a month earlier.
If they're right, the jobs market slowed considerably last month after a remarkable November, which saw more than 59,000 new jobs and a dip of two percentage points in the unemployment rate.
That's the way the labour market has been going, having stalled in October after two solid months in September and August. So it wouldn't be surprising to learn that growth slowed last month.
"After 50,000+ gains in two of the prior three months, employment looks to rise a much more modest 5,000 in December," said senior economist Benjamin Reitzes of BMO Nesbitt Burns.
"That would put 2012 job growth at 1.1 per cent, the weakest non-recession year since 1996, consistent with lacklustre economic growth."
Over all, the Canadian employment scene has been a standout when compared to the United States and Europe.
By November, the economy created 294,000 mostly full-time jobs from the same period a year earlier, marking growth of 1.7 per cent. Public sector jobs climbed by 2.1 per cent, and private sector positions by 1.7 per cent.
One of the weak spots, of course, is the labour market for young people, whose jobless rate stands at 14 per cent, with absolutely no employment gains over the same 12 months.
Economists expect to see weakness in the hospitality and construction sectors, the latter an illustration of how rapidly Canada's real estate market is easing.
"The hotels and restaurants sector which saw a big gain in November, perhaps driven by the Grey Cup in Toronto, stands out as ripe for a reversal," Mr. Reitzes said.
"Also, look for construction to continue cooling as housing slows, while manufacturing will be worth watching as it has dropped in five of the past six months, with the [Canadian dollar] and U.S. fiscal uncertainty weighing."
The projection for today, of 5,000 jobs, is the Bay Street consensus, and the final numbers could easily come in below or above. Toronto-Dominion Bank, for example, takes a considerably dimmer view, expecting to learn today that Canada lost 10,000 jobs.
"While employers have been generally constructive on hiring intentions for some time, our sense is that much of the hiring that was planned has already occurred," TD economists said in a report.
"Moreover, for an economy that is expanding well below its trend rate of growth and an external environment shrouded by uncertainty, the stellar job gains in the past few months are unsustainable. The weakness in the goods sector since the summer reflects this backdrop and consequently we expect more of the same in December."
Indeed, the best days for the labour market may now be behind us, at least for some time, and the unemployment rate is expected to hold stubbornly above 7 per cent for a protracted period.
"We continue to expect only gradual progress on the jobless rate, as hiring slows in the months ahead, tracking a slower pace of underlying economic activity," said Emanuella Enenajor of CIBC World Markets.