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Are we seeing a slowdown in hiring these days? A closer look at the latest set of jobs reports from Australia, New Zealand, and Canada seems to suggest so! Could this lead to more weakness among the commodity currencies?

New Zealand

As I mentioned in my article on the 3 Factors Dragging the Kiwi Down, New Zealand’s Q2 2014 employment report churned out weaker than expected results as the employment change figure posted a mere 0.4% uptick in hiring instead of the estimated 0.7% increase. Analysts explained that the slowdown was probably caused by the central bank’s recent tightening moves, as rising borrowing costs have started to restrain economic activity.

While the unemployment rate slid from 5.9% to 5.6% during the period, digging deeper into the numbers would show that the drop was spurred by a falling participation rate, indicating that people have exited the labor force and given up looking for work. On a brighter note, salary growth was seen as ordinary time wages for non-government workers marked a 0.6% gain versus the projected 0.5% increase.


The Land Down Under fared much worse than its Oceanic buddy, as employment in Australia fell by 0.3K in July instead of showing the estimated 13.5K rise. This was also much weaker than the previous month’s 14.3K increase in hiring.

unemployment rate target

To top it off, their jobless rate climbed from 6.0% to 6.4% in the same month, reaching its 12-year high. The good news though is that part of this increase resulted from an improvement in the participation rate, which ticked up from 64.7% to 64.8%. Apart from that, analysts also pointed out that changes in the jobs survey data may have also skewed the results.


Rounding up the dismal jobs releases from the previous week is Canada’s employment report, which printed disappointing results for the second month in a row. After reporting a 9.4K drop in hiring for June, market watchers were expecting to see a 25.4K rebound for July but were dismayed to see a feeble 0.2K increase.

The unemployment rate managed to improve from 7.1% to 7.0% in July, but this was mostly sparked by a surge in part-time work and a declining participation rate. Hiring in the educational services and information sectors picked up while the construction and health care industries reported declines.

As you’ve probably noticed, some of the underlying jobs figures tell a different story from the headline numbers. Moving forward, make sure you pay close attention to labor components such as the participation rate or wage growth in gauging whether the jobs situation in a particular country is really improving or not.

Given these latest jobs data, along with the weaker than expected U.S. NFP report for July, do you think we’re seeing a global slowdown in hiring?