Jobless rate falls to 8.3 per cent as 43,000 part-time positions added
OTTAWA (CP) — The Canadian economy got some good news Friday, with a drop in the January unemployment rate to 8.3 per cent — although that bigger-than-expected decrease was due almost entirely to gains in part-time jobs.
Last month’s unemployment rate was one-tenth of a percentage point down from a revised figure of 8.4 per cent in December, Statistics Canada reported.
The impetus was exclusively from 43,000 new part-time jobs. Full-time employment was little changed, suggesting that while the recovery is starting to take hold, jobs growth is still lagging.
Economists had expected 15,000 jobs of all sorts would be added last month.
Despite job increases in four of the last six months, Canada’s employment was still 280,000 lower than in October 2008, when the recession began. The January data, however, reversed December job losses which were reported in a Statistics Canada revision last week.
Economists, though, said part-time jobs are better than nothing.
”The erratic recovery in the job market continues.” wrote Douglas Porter, deputy chief economist at BMO Capital Markets.
”While the details of this report were less impressive than the headline results, there is little doubt that the job market is grinding forward.”
Porter noted that employment is just one-tenth of a percentage point below the levels of a year ago: “An amazingly quick turnaround from the dismal conditions of early last year, all things considered.”
Derek Holt of Scotia Capital said the data aren’t great, but there is improvement.
“The trend is right, if albeit volatile. A seesaw pattern of job gains and losses over recent months has the net picture coughing up job growth, warts and all.“
Dawn Desjardins, assistant chief economist at the Royal Bank, said the job increases bode well for the next few months.
“January’s job gain augurs well for the pace of expansion to remain firm in the first quarter of 2010.” she said.
The federal government this week pledged to make job creation a top priority in the coming weeks.
Ken Georgetti, president of the Canadian Labour Congress that represents most of Canada’s unions, said the government must continue its stimulus spending to create jobs.
“The private sector cannot, at this point, create a sufficient number of jobs and economic growth,” Georgetti said. “Now is time for industrial development strategies and procurement policies that create jobs.”
For months opposition parties have demanded that the government bring in a robust job-creation policy. The government is scheduled to release its next budget on March 4 but Finance Minister Jim Flaherty has said there won’t be additional spending beyond the plan announced January 2009.