Canada’s jobless rate fell for the first time in five months in February even as employment declined, due to a larger drop in the number of people in the workforce.
Employment fell by 2,800 after a January increase of 2,300, Statistics Canada said today in Ottawa. The unemployment rate fell to 7.4 percent from 7.6 percent as 37,900 people left the labor force, the largest drop since January 2009. Economists surveyed by Bloomberg News had forecast an increase of 15,000 jobs and a 7.6 percent unemployment rate.
Canada’s job growth has been slowing since the middle of last year after hiring gains led the economy out of a recession in 2009. Consumer spending aided by low interest rates is still helping drive growth, the Bank of Canada said yesterday, while keeping its key policy rate at 1 percent.
“All told, a disappointment,” said Avery Shenfeld, Chief Economist at Canadian Imperial Bank of Commerce in Toronto, “and one that will temper expectations after yesterday’s statement that the Bank of Canada is moving towards hiking rates sooner rather than later.”
The Canadian dollar remained weaker after the report, falling 0.2 percent at 99.21 cents per U.S. dollar at 7:14 a.m. in Toronto. One Canadian dollar purchases $1.0080.
Young workers, defined as those aged from 15 to 24, accounted for almost all of the lost jobs in February with a decline of 26,800. Men older than 24 gained 25,800 jobs while women in that age group lost 1,700, Statistics Canada said. Youth unemployment rose to 14.7 percent from 14.5 percent.
By industry, retailing and wholesaling led the job decline with a 37,400 decrease, followed by a 21,900 drop for transportation and warehousing, Statistics Canada said. Health care and social assistance fell 21,700 while public administration declined by 14,700.
Employment in finance, insurance real estate and leasing rose by 41,200 in February, recouping half the industry’s losses over the previous five months. Construction rose by 14,000 and natural resources gained 6,800, capping a 10.2 percent gain over the past year, the fastest of any industry.
Atco Ltd. said March 5 it won its largest-ever Canadian contract to build housing for a natural resources project, a 2,586-person lodge for BHP Billiton Ltd. (BHP)’s Jansen potash site in Saskatchewan.
The U.S. may report at 8:30 a.m. that non-farm payrolls increased by 210,000 in February, according to the median estimate in a Bloomberg survey.
Canadian part-time employment fell by 12,000 in February while full-time jobs increased by 9,100.
Workers classified as employees fell by 15,100 while the self-employed increased by 12,300, Statistics Canada said.
Private-sector employment decreased by 1,700 and public- sector jobs fell by 13,400.
Average hourly earnings of permanent employees rose 2.1 percent in February from a year earlier. The Bank of Canada says that figure is a key indicator of inflation.
Today’s release is the last time this indicator will be published at 7 a.m. in Ottawa. Beginning next month, Statistics Canada will release all indicators at 8:30 a.m.
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