Notes from The Desk | US & Canadian Employment – Not Cinco-ing (de Mayo) with Expectations May 5 2023

Notes From the Desk: US & Canadian Employment – Not Cinco-ing (de Mayo) with Expectations


Both the US and Canadian employment wage growth data were stronger than expected, as the inflation dragon is proving much harder to slay.


The Canadian numbers.


  • 41k jobs added versus the expected 20k.  Although, the mix was poor, with the gains coming from part-time jobs.
  • Unemployment stayed at 5.0%, below expectations of 5.1%
  • Wage growth came in at 5.2% versus an expected 4.8%


The US numbers.


  • Non-farm payrolls improved by 253k; consensus was 185k.
  • Unemployment dropped to 3.4%, counter to expectations of a tick up to 3.6%.
  • YoY wage growth came in at 4.4%, versus 4.2% expected.




  • Today’s data does not support core inflation dropping below 3% by the summer.  It also leans against the bond market expecting central banks to cut rates this year.
  • Absent the US regional banking crisis, we would have expected the question to shift from ‘When are they going to cut’to ‘Are they going to hike again.’
  • For now, yields are up 6-13 bps, but if action is taken to quell the banking fears, we could see rates move materially higher.
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