Canada Posts First Job Gain in Four Months

Canada recorded a surprise job gain in August, the first in four months, suggesting the country is emerging from its first recession since 1992.

Employment rose by 27,100, Statistics Canada said. The jobless rate increased to 8.7 percent from July’s 8.6 percent, the highest since January 1998, as the labor force grew faster than employment.

The employment gain was led by 30,600 part-time jobs, while full-time positions declined by 3,500. Retailers and wholesalers hired 21,200 people and financial and real estate companies added another 17,500.

The job report is also the last major piece of data due before the Bank of Canada’s Sept. 10 interest-rate decision. Governor Mark Carney said in July the economy started growing again this quarter, and committed to keeping his key lending rate at a record low 0.25 percent through next June if the inflation outlook doesn’t change. The jobless rate will likely keep rising even as the economy resumes growth, Carney said.

Canadian average hourly wages rose 3.3 percent in August from a year earlier, the slowest advance in more than two years, Statistics Canada said today.

Manufacturing employment fell by another 17,300 in August, bringing the total loss over the prior 12 months to 231,300, or 12 percent, Statistics Canada said.

Manufacturers have been among the hardest hit by the recession and the effects of a stronger currency. U.S. orders of lumber and automobiles have been slashed, and Bank of Canada Deputy Governor Timothy Lane said Aug. 25 that persistent strength in the country’s currency is an important risk” to the economy. A stronger currency makes factory goods less competitive.

Other companies made up for the factory job losses in August. Employment at private companies rose by 49,200, while government jobs fell 11,500 and self-employment declined by 10,600. Construction employment rose by 12,100 and professional and scientific services jobs rose 10,400.

Canada Posts First Job Gain in Four Months, Bloomberg
9/4/2009 9:30:47 AM