Breaking News
Investing Pro 0
Cyber Monday SALE: Up to 54% OFF InvestingPro+ CLAIM OFFER

Canada sheds jobs for third month but won't stop rate hikes

Economy Sep 09, 2022 12:12PM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
5/5 © Reuters. FILE PHOTO: A help wanted sign hangs in a bar window along Queen Street West in Toronto Ontario, Canada June 10, 2022. REUTERS/Carlos Osorio 2/5

By Julie Gordon

OTTAWA (Reuters) -Canada shed jobs for a third straight month in August, in a sign higher interest rates may be starting to cool the overheated economy, official data showed on Friday, though economists said it was unlikely to force a central bank pause.

The Canadian economy lost a net 39,700 jobs in August, missing analyst forecasts that it would add 15,000, Statistics Canada data showed. The jobless rate rose to 5.4%, missing calls it would edge up to 5.0% from a record low 4.9% in July.

"I think this can be taken as a reasonable indication that the economy is, in fact, slowing," said Andrew Kelvin, chief Canada strategist at TD Securities.

"When you look at the increase in the unemployment rate, that does suggest that maybe a little bit of slack is starting to return to the labor market, though it's not a complete process and it will be a slow process," he added.

Canada has lost a net 113,500 jobs in the last three months. In June and July the majority of those losses were attributed to people leaving the labor force, but that trend reversed in August as 66,200 people joined the workforce.

Over those same three months, job losses were concentrated in educational services, an often volatile segment during the summer months, and wholesale and retail trade. In August, construction jobs also fell sharply.

Three straight months of job losses "hasn't historically happened outside of a recession," said Royce Mendes, head of Macro Strategy at Desjardins Group, adding: "The deterioration in the job market appears to be occurring faster than anticipated."

Still, full-time employment was 3.9% higher than a year ago, Statscan said.

And wage gains continued to accelerate in August, up 5.6% on the year compared with 5.4% in July, with more people saying they were planning on leaving their current jobs in the next 12 months, citing pay and benefits as their top reason.

That wage pressure, which can fuel inflation, will likely keep the Bank of Canada in rate-hiking mode, economists said.

"I think the Bank will be more focused upon the wage side of the picture - the modest acceleration that we have there that's ongoing," said Derek Holt, vice president of Capital Markets Economics at Scotiabank.

Money markets pulled back from bets of a 50-basis point increase at the bank's next decision in October after the data, leaning strongly toward 25 bps.

The Bank of Canada lifted its policy rate to 3.25% on Wednesday, its highest level in 14 years, and left the door open to more hikes amid hot inflation.

The Canadian dollar was trading up 0.4% at 1.3044 to the U.S. dollar, or 76.66 U.S. cents.

 

Canada sheds jobs for third month but won't stop rate hikes
 

Related Articles

Australia retail sales unexpectedly fall in October
Australia retail sales unexpectedly fall in October By Investing.com - Nov 27, 2022

By Ambar Warrick Investing.com-- Australian retail sales fell for the first time this year in October, data showed on Monday, as rising inflation and elevated interest rates now...

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Comments (4)
Gold Member
getoverit Sep 09, 2022 11:51AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Thanks to Trudo, Canada became communist dictatorship state, worse than China
Michael Roal Casa
Michael Roal Casa Sep 09, 2022 11:51AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
says the expert without any information to back up his statement.. getoverit
Bill Powers
Bill Powers Sep 09, 2022 11:51AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Trudeau was called out at an EU parliament meeting in March by multiple members for acting like a dictator. by the looks of your profile picture, you're the last person who should be talking about experts
Gold Member
getoverit Sep 09, 2022 11:51AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Michael Roal Casa  I will provide you tons of info once you provide me the proof that masks save lives
jason xx
jason xx Sep 09, 2022 10:14AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Yes the people of Canada will be happy the government is focused on getting their wages down
Connecticut Yankee
A_Jaundiced_Eye Sep 09, 2022 9:38AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Preview of coming (U.S.) attractions.
David Beckham
David Beckham Sep 09, 2022 9:20AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
It’s done get ready for housing crash then Asians will buy all their houses
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
or
Sign up with Email