March hiring spree stirs hope for Canada's jobless

Thu Apr 5, 2012 11:53am EDT
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By Louise Egan

OTTAWA (Reuters) - Canada's ailing jobs market sprang back to life in March with a stunning 82,300 net new jobs, the most since September 2008 and a tentative sign that the economy may be growing enough muscle to pressure the central bank to raise interest rates.

The job gains reported by Statistics Canada on Thursday were eight times bigger than expected, and were spread fairly evenly across several sectors. Strong private-sector hiring and more full-time positions suggested underlying economic strength.

"Hibernation is over for Canadian employment. After a lengthy lull it's come roaring back with a rather incredible gain," said Doug Porter, deputy chief economist at BMO Capital Markets.

The jobless rate in the month dipped to a six-month low of 7.2 percent from 7.4 percent in February, more than 1 percent below the comparable U.S. rate.

The news pushed the Canadian dollar higher against the U.S. dollar.

Other economic data on Thursday showed that fewer residential building permits were issued in February, which may signal that Canada's hot housing market, a source of concern for policymakers, is cooling. The overall value of building permits in the month, however, jumped 7.5 percent from January on strength in nonresidential sectors.

Another indicator showed the pace of corporate purchasing activity in the economy in March remained positive, with the Ivey index dipping to 63.5 from 66.5 in February. Any figure above 50 in the index shows growth.

JOB CUTS ON HORIZON   Continued...