Canada's Unemployment Rate Rises


Canada's jobless rate unexpectedly rose from a three-decade low in March, as a surge of people entered the labor force while employment gains slowed.

The unemployment rate rose to 6 percent from 5.8 percent and employers hired 14,600 new workers after adding 43,300 in February, Statistics Canada said today from Ottawa. The labor force grew by 57,100, increasing the share of the population that's working or looking for jobs to a record 68 percent.

Business and consumer spending are propping up the economy as exporters of automobiles and lumber are hurt by weak U.S. demand and global credit shortages. Canada's gross domestic product will grow 1.8 percent this year after 2.7 percent in 2007, the Bank of Canada predicts. Policy makers will probably cut interest rates again soon, Senior Deputy Governor Paul Jenkins said two days ago. The next decision is April 22.

Transportation and warehousing companies hired 19,900 workers and another 10,200 people found work in business services, Statistics Canada said.

Hourly wages rose 4.7 percent in March from a year earlier, slower than the 4.9 percent rate of the previous three months, which was the fastest in at least a decade. Still, wages are rising more than twice as fast as consumer price inflation.

The overall employment gain was limited by a drop of 24,300 jobs in information, culture and recreation.

Manufacturing payrolls fell by 9,400, bringing the 12-month loss to 113,300 or 5.4 percent of the workforce. Factories have been hurt by a high Canadian currency, energy costs and slumping U.S. demand.


TradingEconomics.com, Bloomberg
4/4/2008 6:38:09 AM