Alberta's April job gains seen as anomaly; more weakness expected

Fri May 8, 2015 3:15pm EDT
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By Leah Schnurr

OTTAWA May 8 (Reuters) - Strong job gains in Alberta in April were likely an anomaly, possibly influenced by hiring related to the Western Canadian province's May 5 election, and economists predicted more weakness in coming months due to relatively low oil prices.

Alberta added 12,500 jobs in April on strength in the service sector as natural resources jobs declined, data from Statistics Canada showed on Friday.

The report was met with some skepticism. Economists have previously complained the data, which is based on a household survey, can be volatile on a monthly basis.

Alberta, the biggest source of U.S. oil imports, was hit hard by the recent crude oil price plunge, which played a role in the surprise election this week of a left-leaning government.

"It's very strange to see the trend in employment in Alberta is still quite good," said Benoit Durocher, senior economist at Desjardins.

Economists said a first wave of job losses directly related to the energy sector will likely be followed by more as the price shock makes its way through the economy.

"The second leg would be into other areas like the housing market, which we're starting to see weaken now, and service sectors that derive a lot of business from the energy sector," said Robert Kavcic, senior economist at BMO Capital Markets.

The 18,000-job increase in the services sector suggests laid-off oil workers are finding work there, while the run-up to the provincial election held this week could also have contributed some of the gains, Kavcic said.   Continued...