Canada posts biggest job loss in 17 years
Globe and Mail Update
August 8, 2008 at 7:47 AM EDT
The Canadian economy lost 55,200 jobs in July, when economists had forecast an increase, but the unemployment rate shrank to 6.1 per cent, Statistics Canada said Friday.
The employment figures showed the biggest loss in jobs since February 1991, when 57,000 disappeared as recession gripped Canada. The bulk of the July losses – 48,000 – came from part-time positions, while the hardest hit sectors were business, building and other support services, and educational services.
“Statistics Canada seems to have caught up with what we've been reading in the newspapers for months, that a lot of plants were closing and a lot of jobs were being shed,” CIBC World Markets economist Avery Shenfeld said. “There were particularly heavy losses in the private sector, which is, again, a worrisome sign.”
In fact, the only significant gains came in accommodation and food services, Statscan said. The public sector also showed some gains.
Economists had predicted the addition of 5,000 jobs, the same number unexpectedly shed in June. They also had forecast the unemployment rate would remain steady from the previous month at 6.2 per cent.
However, Statscan said the rate edged down because many people, particularly youth, left the labour force.
“Canada's economy is clearly downshifting, in response to the downturn in the U.S. and to the run-up in the [Canadian dollar],” BMO Nesbitt Burns economist Jennifer Lee told clients in a note.
“Of relief to policy-makers, the slackening labour market is taking steam out of wages,” she added, noting Statscan also reported that the increase in average hourly earnings slowed to just under 4 per cent, year over year, the smallest gain in more than 12 months.
Friday, August 8, 2008
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