Canada's job situation has taken a turn for the worse as a survey released Tuesday shows fewer firms are interested in hiring, while more want to cut jobs.

Manpower Canada, an executive search firm, said its latest roundup of employment intentions indicated that, for the January-to-March period next year, 16 per cent of Canadian companies believe they will add jobs while nine per cent think they will be reducing payrolls.

In the previous findings, 20 per cent of Canadian companies said they would hire people in the fourth quarter of 2008 while seven per cent of firms said they were in a firing mood.

The 46-year old survey of firm sentiment in Canada is part of a global survey of corporations' intentions conducted by Manpower Canada's parent company.

Ontario looks particularly vulnerable to layoffs as the province posted a seasonally adjusted net employment outlook figure — a measure of potential job increases — of eight per cent in the latest survey, down nine percentage points from the previous three-month period.

The weak intention numbers come hard on the heels of last Friday's poor jobs report out of Statistics Canada. In November, Canadian payrolls were cut by 71,000, or four-tenths of a percentage point.

The country's unemployment rate stood at 6.3 per cent in November.

With retailers facing a bleak Christmas, automakers staring at potential bankruptcy and construction firms eyeing a plunging housing market, many analysts expect Canada's job situation to get worse before it improves.

U.S. situation worsens

Still, the Canadian results are far ahead of the bleak outlook held by U.S. firms.

Parent company Manpower Inc. noted that, while 16 per cent of American employers expect to add jobs in the first quarter of 2009, 13 per cent said they are looking to reduce payrolls.

That figures matched the percentage of employers that expected to cut payrolls in the fourth quarter of 2008. Both numbers, however, were yearly highs for this indicator in the United States.

Worse still, the "net employment outlook" for American companies was a seasonally adjusted 10 per cent. By comparison, Canada's employment outlook rose four percentage points to 18 per cent.

The last time the U.S. jobs sentiment number reached as high as Canada's current level was in the second quarter of 2008.