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Canadian Economy Sheds 28,900 jobs in April

H.S. Borji
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Canadian Economy Sheds 28,900 jobs in April

Employment in Canada decreased sharply in April, defying expectations the labour market was beginning to stabilize after a prolonged period of volatility.

Canadian employers shed 28,900 jobs in April, following a gain of 42,900 the prior month, Statistics Canada reported today in Ottawa. Economists expected a gain of between 12,000 and 20,000 at the start of the second quarter. The unemployment rate remained at 6.9 percent, while labour force participation eased from 66.2 percent to 66.1 percent.

Compared to April 2013, the number of employed people increased by 0.8 percent or 149,000, evenly distributed between full-time and part-time work. Over the same period, the number of hours worked declined 1.1 percent, as more workers took extra vacation time around Good Friday.

The declines were led by financial services and accommodation and food services, official data showed. Employment in financial services declined 19,000, as employment in the industry was little changed over the previous 12 month period. Employment in accommodation and food services declined 32,000, bringing employment in this sector down to a level similar to that of April 2013.

The manufacturing sector reported signs of weakness in April after posting moderate gains the prior month, while hiring in construction remained flat.

Employment in business and support services increased 26,100, with the western provinces of Alberta and British Columbia posting the biggest advances.

“There has been little overall employment growth in Canada since August 2013,” Statistics Canada said in a press release.

Year-on-year, employment in the private sector increased 1.7 percent, while public sector employment edged down. Self-employment was little changed, official data showed.

The report diminished optimism the Canadian labour market may be stabilizing after a long period of volatility. Employment data have have been especially volatile in recent months. The labour market shed 44,000 jobs in December, followed by a gain of 29,400 in January. Employment then declined in February and rebounded sharply in March.

The news comes amid heightened scrutiny concerning the government’s labour data. The auditor general spring report, released earlier this week, found Statistics Canada’s labour force survey too vague, concluding the figures provided little value to its readership.

Given that job creation continues to be a central component of the federal government’s economic action plan, gaps in the labour force survey could bring heat to the Conservative government ahead of the 2015 federal elections.

The Canadian dollar fell from its four-month high following the news. The loonie clawed back most of its recent gains, declining 0.7 percent to 0.9168. The Canadian currency has been buoyed by improving data and broad weakness from the US dollar.

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