BUSINESS

Canada Sheds 7,000 Jobs In February; Economists Were Expecting Growth

03/07/2014 08:56 EST | Updated 03/07/2014 09:59 EST
Martin Barraud via Getty Images

The rebound in the job market that economists had been expecting failed to materialize in February, as Canada lost 7,000 jobs that month, according to Statistics Canada.

Economists had been forecasting an increase of 15,000 jobs, with a decline in the unemployment rate to 6.9 per cent. The unemployment rate stayed steady at 7 per cent in February, StatsCan said.

That follows a surprisingly large decrease in jobs in December and a bounce-back in January. For the third month in a row, Canada's unemployment rate was higher than the U.S. The Bureau of Labor Statistics reported Friday that the U.S. economy created 175,000 jobs in February, with the unemployment rate at 6.7 per cent.

Canada created 95,000 jobs in the year to February, StatsCan said, representing a 0.5 per cent increase in the number of jobs, about half what's needed to keep up with population growth.

"There has been little overall employment growth in Canada since August 2013," StatsCan said.

The numbers are likely to exacerbate concerns that Canada's job market is hitting the brakes. A recent report from the Canadian Chamber of Commerce said Canada's employment situation "sputtered" in 2013, with the economy mostly cranking out part-time jobs, most new jobs going to older workers, and nearly 70 per cent of all job creation concentrated in one province, Alberta.

The Canadian Labour Congress, an umbrella group of unions, has asked StatsCan to change the way it reports unemployment, arguing that its recent reports are not accurately reflecting the dire situation in Canada's labour market.

The Canadian Press reports:

The softness was reflected in the employment rate, which held steady at 61.6 per cent, still about two percentage points below the pre-recession highs.

There were 15,500 fewer people classified as employees but 8,600 more people became self-employed.

There were some bright spots in the employment report, which is one of the most important barometers of how the economy is doing.

Despite the overall loss of jobs as 25,900 fewer people were in part-time work, as full-time employment rose by 18,900.

As well, the weakness came in the public sector, as declines in health care and social assistance, education services as well as transportation and warehousing contributed to a 51,000 dip in the labour pool. Private sector employment rose by 35,200.

Regionally, Quebec and British Columbia both had off employment months of 25,500 and 10,400 respectively, while Alberta and Nova Scotia saw gains of 19,000 and 2,900.

By industry, there were 9,000 more workers in natural resources and 7,900 more in agriculture in February, but 25,000 fewer in finance, insurance, real estate and leasing. Manufacturing saw a small pick-up of about 5,000, while construction lost 3,600.

In a separate report, Statistics Canada said the country's trade deficit had significantly narrowed to $177 million in January from $922 million the previous month, although most of the improvement had little to do with jobs generating exports. In fact, in volume terms, exports fell 5.3 per cent, while a sharp decline in imports and better prices helped the bottom line.

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