WATCH: There’s some encouraging economic news on the jobs front today. As Reid Fiest reports, Stephen Harper seized on the numbers.
The Canadian economy gained 12,000 jobs in August, bolstered by a jump in full-time employment, Statistics Canada said Friday. The unemployment rate ticked higher for the first time in months, though, as more people said they were looking for work.
The jump in hiring surprised experts, with most anticipating a decline of about 5,000 positions as low oil prices drained momentum from the energy sector and related industries.
Yet the job market kept chugging along.
“While no ball of fire, Canada’s employment backdrop simply refuses to follow the recession script,” Doug Porter, BMO’s chief economist, said.
The jobs report is the latest data point fueling optimism about the economy’s performance in spite of an oil shock that’s clawed back growth through the first six months of the year.
The labour market’s performance alongside other data suggests the first-half slump has been stemmed. On Thursday, trade data revealed a long-awaited rebound in Canada’s export sector may have taken hold in July.
Statscan said earlier this week the economy returned to growth in June for the first time in 2015, raising hopes that the recessionary dip will be short-lived.
The job gains in August followed a modest jump in payrolls in July, the first time since last fall the job market posted back-to-back monthly increases.
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‘Sometimes a rise in the unemployment rate is actually something to cheer about.’
Despite the modest uptick in net new jobs, the unemployment rate ticked two-tenths of a percentage point higher, to 7.0 per cent, as more people looked for work.
A strong gain in full-time jobs — 54,000 — was more than offset by an even bigger jump in the number of unemployed Canadians who were seeking work last month, the federal statistical agency said.
“Sometimes a rise in the unemployment rate is actually something to cheer about, if it’s the result of more people looking for work rather than outright job losses,” Shenfeld said.
Still, most of the full-time gains weren’t the result of private companies expanding payrolls, experts said. “The sectoral split showed that most of the full-time jobs were probably in the public sector. In contrast, the private sector added only 6,300 workers,” David Madani at Capital Economics said.
“Employment gains in the private sector over the past six months have slowed to a trickle, broadly consistent with the slowdown in the economy.”
The Bank of Canada has cut its key interest rate twice this year in an effort to provide a cushion for the economy, which has been hit hard by the slump in oil prices that began last year.
The central bank, which makes its next interest rate announcement next week, has predicted the economy will grow at an annual pace of 1.5 per cent in the third quarter before picking up to a 2.5 per cent pace in the last three months of the year.
— With files from The Canadian Press