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- Sep 14, 2007
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Employment in Canada fell by a larger than expected 82,600 in February, beating forecasts for a 55,000 jobs loss. The job losses combined with a 23,100 increase in the labour force sent the unemployment rate sharply higher to 7.7% from 7.2% in January. Markets were looking for the unemployment rate to tick up to 7.4%.
Once again, the decline in employment was concentrated in full-time jobs, which were off 110,900 building on January`s 113,900 job cut. Part-time positions rose in February by 28,300. This month it was service-producing industries that took the hit with 71,200 cut from payrolls. Goods producers also cut back, but by a more modest 11,300.
More than one-half of the monthly decline was the cut in construction jobs, which fell by 43,200. Manufacturing positions increased by 24,700, mildly denting the 101,000 job losses reported in January. We expected the rebound in manufacturing to be in the auto industry after the sharp cuts reported in January; however, employment in the transportation component was little changed in February. On the services side, wholesalers and retailers cut 17,700 jobs; health care and educational services and business, building and other support services also reported declining payrolls in February.
The weakness was concentrated in Ontario again with another 35,000 jobs lost in February for a total of 106,300 in the first two months of 2009. Ontario`s unemployment rate rose to 8.7%, the highest since 1997. Alberta cut 24,000 and Quebec shed 18,000 positions.
Year-over-year growth in average hourly wages for permanent workers slowed to 3.9% from 4.7% in December. The not seasonally adjusted monthly series fell 0.5%.
Canada`s labour market was hit hard in early 2009 as the weakening demand late last year resulted in businesses cutting their payrolls. While Canada may have been late joining the recession and the magnitude of the job cuts still pales in comparison to what has happened in the United States, the effect of the labour market weakening, financial market upheaval and sagging global economy resulted in real GDP contracting at its fastest pace in 17 years in the final quarter of 2008.
Furthermore, recent data point to another hefty slump in GDP in early 2009. For the Bank of Canada, the developments are following their play-book even if the weakness in late 2008 was greater than they had anticipated. There is no real good news in the report and, if anything, it furthers the case for the Bank to clarify its plan should the need for a shift to a quantitative easing policy be required.
Once again, the decline in employment was concentrated in full-time jobs, which were off 110,900 building on January`s 113,900 job cut. Part-time positions rose in February by 28,300. This month it was service-producing industries that took the hit with 71,200 cut from payrolls. Goods producers also cut back, but by a more modest 11,300.
More than one-half of the monthly decline was the cut in construction jobs, which fell by 43,200. Manufacturing positions increased by 24,700, mildly denting the 101,000 job losses reported in January. We expected the rebound in manufacturing to be in the auto industry after the sharp cuts reported in January; however, employment in the transportation component was little changed in February. On the services side, wholesalers and retailers cut 17,700 jobs; health care and educational services and business, building and other support services also reported declining payrolls in February.
The weakness was concentrated in Ontario again with another 35,000 jobs lost in February for a total of 106,300 in the first two months of 2009. Ontario`s unemployment rate rose to 8.7%, the highest since 1997. Alberta cut 24,000 and Quebec shed 18,000 positions.
Year-over-year growth in average hourly wages for permanent workers slowed to 3.9% from 4.7% in December. The not seasonally adjusted monthly series fell 0.5%.
Canada`s labour market was hit hard in early 2009 as the weakening demand late last year resulted in businesses cutting their payrolls. While Canada may have been late joining the recession and the magnitude of the job cuts still pales in comparison to what has happened in the United States, the effect of the labour market weakening, financial market upheaval and sagging global economy resulted in real GDP contracting at its fastest pace in 17 years in the final quarter of 2008.
Furthermore, recent data point to another hefty slump in GDP in early 2009. For the Bank of Canada, the developments are following their play-book even if the weakness in late 2008 was greater than they had anticipated. There is no real good news in the report and, if anything, it furthers the case for the Bank to clarify its plan should the need for a shift to a quantitative easing policy be required.