Canada's jobless rate falls to 33-year low of 5.8%
The Canadian economy generated an astonishing 63,000 new jobs in October, bringing the jobless rate down to a generational low of 5.8 per cent.
The market had been expecting only modest growth of 15,000 jobs.
Getting the jobs picture
Every month, Statistics Canada contacts 54,000 households for its labour force survey, gathering labour market data on about 100,000 people aged 15 and older in every province and territory.
Selected households are followed for six months. The first interview is usually in person, with subsequent ones by phone. As with the census, participation is mandatory.
Full-time military personnel, those ininstitutions and those living on reserves are excluded from the survey.
The figures are seasonally adjusted to account for fluctuations caused by climate, holiday seasons and vacations.
The unemployment rate fell a tenth of a percentage point from September.
The news sent the Canadian dollar shooting sharply higher, as any interest rate cut by the Bank of Canada now looks extremely unlikely.
The loonie gained1.92 cents to close at $1.0704 US on foreign exchange markets.
The report showed wage pressures continuing to build. The average hourly wage is now 4.1 per cent higher than it was a year ago, well above the 2.5 per cent increase in the cost of living.
Employment grew in every province in the country, with Ontario leading the way for the second straight month with a net addition of 32,200 jobs — enough to drop its unemployment rate to 6.0 per cent.
Alberta again had the lowest jobless rate, at 3.4 per cent. The jobless rate fell in all four Atlantic provinces.
|Unemployment rates - October 2007|
|Province||Rate (%)||% change from Sept.|
Women and workers over the age of 55 had another banner month.Women now have an unemployment rate of just 4.3 per cent, the lowest rate inmore than30 years. Older workers accounted for much of October's employment gains, Statistics Canada said.
Job growth was led by the service sector, where strong growth was seen in health care and social assistance, public administration and trade.
The goods-producing sector, however, remained weak. Manufacturing lost another 3,500 jobs as the high dollar took more of a toll.
Bank of Canada seen on hold
There's little chance of lower interest rates in Canada in the near term, analysts said.
"A continued ability to have a tight labour market as factory jobs melt away is one reason why we don't see the Bank of Canada rushing to Fed-matching rate cuts," CIBC World Markets economist Avery Shenfeld said in a morning commentary.
Some analysts say the economy isn'tas rosy as the jobs report would make it appear.
"Virtually all of the jobs created in the past three months have been in the public sector, primarily education, health care and government workers," said Ted Carmichael, chief economist at JP Morgan Chase Canada. He noted that 126,000 of the 137,000 jobs added in the last three monthshave been inpublic sector industries, while private sectoremployment has actually dropped (the other new jobs came from self-employment).
"In past economic downturns, private sector employment has been a better guide to the direction of the economy than total employment," he wrote in a morning commentary.