The Canadian economy created a stronger-than-expected 43,000 jobs in January, led by part-time work, the fourth employment gain in six months.
The country's jobless rate fell a notch to 8.3 per cent, a nine-month low, Statistics Canada said Friday.
It's a far cry from the same month last year, when employment in Canada plunged by 130,000 – the most on record. Though much of last month's gains stemmed from lower-paying part-time work, the private sector is now adding to payrolls.
“Part-time jobs are better than none,” said Douglas Porter, deputy chief economist at Bank of Montreal in a note. Though jobs numbers have been bumpy in recent months, employment is now just 0.1 per cent below year-ago levels, “an amazingly quick turnaround from the dismal conditions of early last year, all things considered.”
Part-time employment formed the lion's share of January's increase, with 41,500 new positions, returning it to the level of six months ago. Full-time employment rose by just 1,400, though it has been increasing over the past half year, the agency said.
And the private sector is hiring. Job growth in the private sector rose by 53,700 positions while the public sector added 13,400 jobs. Self-employment, which swelled throughout last year as people had little other options, fell by 24,000 positions.
Youth are finally getting a break. Employment gains last month were driven by women aged 25 to 54 and young people. It's the first real increase in jobs for youth since employment started to deteriorate in the fall of 2008. Youth jobs rose by 29,000, pushing their unemployment rate to 15.1 per cent from 16 per cent.
Business, building and other support services, along with retail and wholesale trade were the main drivers of employment increases. Manufacturing and agriculture shed workers.
Ontario accounted for more than half of last month's job gains.
Despite the recent increases, employment remains 280,000 below its level in October, 2008.
Monthly jobs numbers have been volatile lately. The overall trend shows the labour market has stabilized since the summer, after a sharp drop in the first nine months of the recession, said Geoff Bowlby, Statscan's director of labour statistics, in an interview this week.
Average job growth over the past three months is now 29,000, according to Toronto-Dominion Bank, while the six-month trend has risen to 22,900 jobs a month.
The strong report “suggests the Canadian economic recovery picked up considerable speed in the first month of the year,” said Millan Mulraine, TD's economics strategist, though he cautioned that the current pace of job growth “may be overstating” the true extent of the recovery.
Bank of Canada Governor Mark Carney said Thursday slower wage growth will moderate pressures on core inflation. The central bank plans to hold its key lending to a record low until midyear, provided its inflation outlook doesn't change.
Volatility in the jobs numbers could continue. December saw a steep run-up in temp jobs in the health-care sector, associated with the national H1N1 vaccination program – positions will soon wind down as the extension of the program into workplace vaccinations comes to a close, noted Stewart Hall, economist at HSBC Securities (Canada).
Though the headline number appears impressive, details – such as the prevalence of part-time work and continued losses in the goods-producing side of the economy, suggest “the reality is a little colder and somewhat starker,” he said.
Job growth can often be sluggish as economies emerge from recession as employers first require existing staff to work more hours before they decide to hire.
Economists had expected employers added a modest 15,000 positions last month. The jobless rate was expected to be 8.5 per cent.
Statscan last month revised its numbers for December, to an 8.4-per-cent jobless rate from 8.5 per cent, and to 28,300 job losses from the originally reported 2,600 job cuts.
The Canadian dollar strengthened to 93.46 cents from Thursday's close of 93.22 cents.
The U.S. jobless rate unexpectedly fell to 9.7 per cent, its lowest level since August, and the economy shed 22,000 jobs last month, the Labour Department said Friday. The jobless rate had previously been 10 per cent, near a 26-year high.
