Econ­omy lost 6,400 jobs in June

Gain in full-time jobs off­set part-time losses


Canada suf­fered a net loss in jobs last month but over­all per­for­mance on the em­ploy­ment front was bet­ter than ex­pected in a re­sult that did lit­tle to shed light on what the Bank of Canada will do on in­ter­est rates next week.

The cen­tral bank is ex­pected to re­duce its eco­nomic out­look for the year, but whether it will cut its key in­ter­est rate is a mat­ter of de­bate among econ­o­mists.

“On bal­ance, this was a slightly bet­ter re­sult than ex­pected and makes the (cen­tral) bank's de­ci­sion next week very much a toss-up,” BMO chief economist Doug Porter said of the jobs re­port.

“Hav­ing forecast that we ex­pect the bank to trim rates next week, we're not go­ing to change the call on one murky labour force sur­vey - but it will make for one in­tense de­bate next week for the bank, es­pe­cially if Greece does in­deed man­age to reach a deal this week­end.”

Sta­tis­tics Canada said there were 6,400 fewer jobs last month, as a strong gain in full­time em­ploy­ment only par­tially off­set a big­ger de­cline in part­time po­si­tions.

The econ­omy shed 71,200 part-time jobs, which pro­vide fewer than 30 hours per week, but added 65,800 full-time jobs. The na­tional un­em­ploy­ment rate held steady at 6.8 per cent.

Econ­o­mists had ex­pected a loss of 10,000 jobs and an uptick in the un­em­ploy­ment rate to 6.9 per cent, ac­cord­ing to Thom­son Reuters.

Con­cerns have been raised in re­cent days about the strength of the Cana­dian econ­omy, with some spec­u­lat­ing the coun­try slipped into re­ces­sion in the first half of the year fol­low­ing a string of dis­ap­point­ing eco­nomic data.

The jobs re­port was the last ma­jor eco­nomic data point be­fore the rate an­nounce­ment and the re­lease of the cen­tral bank's latest mon­e­tary pol­icy re­port.

The C.D. Howe In­sti­tute's mon­e­tary pol­icy coun­cil rec­om­mended Thurs­day that the Bank of Canada keep its tar­get for the overnight rate on hold at 0.75 per cent.

How­ever the de­ci­sion wasn't unan­i­mous. Seven mem­bers of the think-tank's coun­cil voted to keep the key rate on hold, while four sup­ported a cut to 0.50 per cent.

CIBC chief economist Avery Shen­feld said it will likely be a close de­ci­sion, but stuck with his pre­dic­tion of a rate cut.

“We still lean to­wards one more rate cut from the Bank of Canada in the com­ing week, be­cause fore­casts of sun­nier times ahead have a lot of down­side risk,” Shen­feld wrote in a note.

Porter pointed to sev­eral ar­eas of strength in the jobs re­port, in­clud­ing that it was the third month in a row that full­time em­ploy­ment posted strong growth and that wages were up three per cent from a year ago.

To­tal hours worked in June were “quite strong,” he said, adding “usu­ally that's not a bad rule of thumb for how the over­all econ­omy per­formed.”

Com­pared with a year ago, em­ploy­ment in­creased by 176,000 over the past 12 months, en­tirely the re­sult of more full-time work, while the to­tal num­ber of hours worked grew by 2.1 per cent.

Break­ing down the jobs re­port, public sec­tor em­ploy­ment in­creased by 42,200 for the month, while the num­ber of pri­vate sec­tor jobs slipped 26,300.

The num­ber of self-em­ployed de­creased 22,200.

Re­gion­ally, Que­bec lost 33,300 jobs and New Brunswick lost 3,500. Bri­tish Columbia gained 15,400, while New­found­land and Labrador added 4,300. On­tario added 14,000 jobs for the month.

The goods-pro­duc­ing sec­tor lost 1,900 jobs, while the ser­vices sec­tor lost 4,500.

Newspapers in English

Newspapers from Canada

© PressReader. All rights reserved.