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File photo of an oil field worker looking at oil well heads on a well pad near Conklin, Alta. Tens of thousands of jobs in Canada’s oil and gas sector were lost in both 2015 and 2016, and a new survey suggests the restructuring isn’t over yet.


Canada added 15,300 jobs in February and the unemployment rate fell to its lowest level in two years, but behind the strong numbers lay some troublesome trends.

Wage growth was weak and the hours worked declined – both stumbling blocks for the country's economic recovery.

Average hourly earnings increased 1.3 per cent from a year earlier, marking the eighth consecutive period of growth below 2 per cent. And despite last month's surge in full-time jobs, the average number of hours worked per week fell, according to Statistics Canada data.

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The steep decline in oil prices has left scars on the country's labour market, even though prices have rebounded from lows of around $35 (U.S.) a barrel to about $50.

Nowhere is that seen more than in oil-producing Alberta, which was responsible for driving up the country's wages for years. During the energy downturn, the province lost thousands of high-paying jobs in mining and oil extraction, and those positions have yet to come back.

At the same time, new jobs are being created in two of the lowest-paid areas – wholesale and retail trade as well as food services and accommodation.

"The subdued earnings growth is partly due to shifts in the composition of employment by industry," said Andrew Fields, an analyst with Statscan.

Over the year, both of these low-paid industries collectively created more than 70,000 new jobs, while natural resources shed 14,500 positions.

"A larger segment of the work force is in lower paid industries. It is going to have a dampening effect on wage growth," Mr. Fields said.

The average weekly earnings for a natural resources job in Alberta was $2,278 last year, more than double the national average of $956 and much higher than trade at $731 and food services and accommodation at $371.

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The elimination of mining and energy jobs has dragged the average earnings in Alberta down along with the rest of the country.

Last month, the natural resources sector only created 1,300 jobs. Meanwhile, employment in wholesale and retail trade rose by 19,000 positions.

Despite the signs of weakness, the country's labour market has beat expectations for months.

Employers created 105,100 full-time jobs and eliminated 89,800 part-time positions, according to Statscan's monthly jobs report released on Friday. The jobless rate eased from 6.8 per cent to 6.6. per cent in February, the lowest level since January, 2015.

Analysts polled by Thomson Reuters had expected a net gain of 2,500 jobs and the unemployment rate to remain at 6.8 per cent.

Canada's labour market stands in contrast to that of the U.S., which continues to show a strong recovery from the Great Recession. U.S. employers added 235,000 jobs and the unemployment rate eased to 4.7 per cent from 4.8 per cent in President Donald Trump's first full month in office.

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About the Author
Economics Reporter

Rachelle Younglai is The Globe and Mail's economics reporter. More


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