Canada's jobless rate fell to a four-year low of 6.9 per cent in March, Statistics Canada said Friday. But analysts said the underlying data aren't as positive as the headline might suggest.
The economy created only 4,400 new jobs last month. The unemployment rate managed to fall mainly because fewer people were looking for work, the federal agency said.
Economists had been expecting 15,000 new jobs last month. They'd also forecast that the unemployment rate would stand pat at seven per cent.
All of the job creation came in part-time work. Statistics Canada said gains in part-time jobs were almost wiped out by a loss of 29,500 full-time jobs.
More than 18,000 jobs disappeared in the accommodation and food services industry, adding to an even bigger loss in that sector in February. All the declines came in the food and beverage industry.
"Compared to a year ago, employment and hours worked have declined in parts of this sector, notably in taverns and bars, possibly due to the National Hockey League lockout," StatsCan said.
Job losses also occurred in warehousing and transportation (perhaps related to Jetsgo's collapse), and in professional, technical and scientific services.
Manufacturing added just 200 jobs and remains one of the weakest sectors over the first three months of the year. More than 35,000 factory jobs have disappeared in the last year as the strong dollar hurt exports.
Agriculture and public administration saw employment gains in March.
Public sector jobs grew by 17,100, while private sector employment fell.
Most provinces saw employment and unemployment change little in March. Alberta saw its unemployment rate fall 0.7 percentage points to a 24-year-low of 3.5 per cent. Statistics Canada said that was mainly the result of fewer people looking for work.
The labour market in western Canada remains strong, with B.C., Alberta and Saskatchewan all showing above-average employment growth.
'Anemic' job gains
TD Bank economist Eric Lascelles called the jobs report "anemic."
"The icy tendrils of Canada's soaring loonie remained visible in many areas of the report," he said in a commentary.
Analysts said the report clearly shows Canadian job growth continuing to slow.
"While each monthly number has to be taken with a grain of salt, the overall trend is towards weaker job gains, a development that will keep the Bank of Canada on hold," said CIBC World Markets economist Warren Lovely.
Economists generally agreed there was nothing in the jobs numbers to lead to any imminent change in interest rates.
The Bank of Canada is scheduled to make an interest rate policy announcement on April 12. Most analysts expect the central bank to leave its key rate unchanged until at least the summer.