November 6, 2023

Canadian Economic Growth Flat As U.S. Employment Growth Slows

Connecting the Dots monitors all major economic announcements in the United States and Canada, but the Metals Service Center Institute (MSCI) also offers industrial metals industry-specific data products that provide much deeper analysis and insight.

Visit MSCI’s website and click on industry data to learn more about our Metals Activity Report (MAR), Momentum Monitors, and Economic Pulse.

Meanwhile, here are the major economic headlines from the last week:

  • According to Statistics Canada, the country’s economy was essentially flat for a second consecutive month in August as factors like higher interest rates, inflation, forest fires, and drought conditions continued to weigh on businesses and consumers. Services-producing sectors expanded 0.1 percent while goods-producing industries contracted 0.2 percent. Overall, eight of 20 industrial sectors expanded. Wholesale trade, which rose 2.3 percent in August, increased for the third time in four months. Read more here.
  • New orders for U.S. manufactured goods rose 2.8 percent in September while the volume of shipments rose 0.4 percent. Unfilled orders, up nine of the last ten months, increased 1.4 percent and the unfilled orders-to-shipments ratio was 6.88, up from 6.78 in August. Inventories, up three consecutive months, increased were up 0.2 percent while the inventories-to-shipments ratio was 1.46, unchanged from August.
  • The Institute for Supply Management’s manufacturing purchasing managers’ index (PMI) for October fell to 46.7 percent in October from 49.0 percent in September. New orders remained in contraction territory at 45.5 percent while the production reading fell to 50.4 percent, a 2.1-percentage point decrease from September. Read the full report here.
  • In October, the S&P Canadian PMI remained below the 50 mark that indicates contraction, coming in at 48.6, a modest improvement from 47.5 in September. The September reading was the lowest since May 2020. Business confidence, output, and new orders all declined. The PMI now has been in contraction territory for six months.
  • According to the Federal Reserve Bank of Dallas, growth in Texas factory activity continued in October. The production index, a key measure of state manufacturing conditions, posted a second positive reading after four months in negative territory. Other measures of manufacturing activity were not as robust, however. The new orders index remained negative, slipping four points to -8.8, while the shipments index remained near zero.
  • S. construction spending expanded 0.4 percent in September to reach nearly $2 trillion. August construction spending was revised upward to a one percent expansion from an earlier 0.5 percent estimate. Over the past year, construction spending has expanded by 8.7 percent.
  • The U.S. unemployment rate ( rose to 3.9 percent in October from 3.8 percent in September, while job growth slowed to 150,000 from 297,000 last month. Employment in manufacturing declined due to strike activity. Labor costs rose modestly, with average hourly wages rising 0.2 percent and annual wage growth decelerating to a two-and-a-half-year low of 4.1 percent. In related news: there were 9.6 million jobs that remained unfilled in the United States in September, and the number of people who claimed federal unemployment benefits continued to rise in late October.
  • Canada’s unemployment rate rose to 5.7 percent in October from 5.5 percent in September. Additionally, the country’s economy added only 18,000 jobs last month. October marked the fourth increase in Canada’s unemployment rate over the past six months. Read the full report here.
  • U.S. worker productivity jumped 4.7 percent in the third quarter of 2023, the largest gain since 2020. The second quarter productivity increase also was also revised upward, from 3.3 percent to 3.6 percent. Unit labor costs, which measure labor against output, fell 0.8 percent in the third quarter due to slowing hourly wage growth. Meanwhile, compensation costs for civilian workers increased 1.1 percent in the third quarter while wages and salaries rose 1.2 percent and benefit costs increased 0.9 percent. Read more here.
  • In other economic news: The Conference Board Consumer Confidence Index for the United States declined moderately in October to 102.6, down from an upwardly revised 104.3 in September.

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