Canada unexpectedly loses 5,500 jobs
Jobless rate rises to 7.3% in August
Canada's unemployment rate in August inched up to 7.3 per cent, rising by 0.1 percentage points from 7.2 per cent in July.
The country lost a total of 5,500 jobs in August — the second consecutive month that employment picture was little changed.
Economists had been expecting overall job growth last month to increase by 21,000 to 25,000. However, the loss of more than 31,000 part-time jobs overwhelmed the addition of 25,700 full-time positions.
The Canadian dollar took an immediate hit, dropping about half a cent to below 101 cents US.
Statistics Canada said job losses in the construction, transportation and warehousing, as well as natural resources sectors offset gains in health care and social assistance.
The private sector lost 20,600 positions, while public-sector employment rose by 22,000.
Employment increased by 4,100 in Nova Scotia in August, but declined by 3,400 in Newfoundland and Labrador and by 3,000 in Saskatchewan.
Economists said in an early reaction that Canadians should prepare for a tough jobs market going forward.
"Jobs momentum has clearly been lost in Canada," Scotiabank economists said in a note to clients.
"It further calls into question the Bank of Canada's (second half of year) optimism as the effects of a global confidence shock work their way through the economic variables."
TD Bank's Derek Burleton noted that the jobs number was not as bleak as the bottom line would suggest, since all the losses were in part-time work.
Full-time employment rose, Burleton said.
Still, he said, Canadians should prepare for the unemployment rate to start edging up, predicting it could go 7.5 per cent or higher by the end of the year.
"Looking through the statistical fog, the underlying trend in Canada's job market is beginning to cool," agreed Bank of Montreal economist Douglas Porter.
With files from The Canadian Press