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OTTAWA, April 8 (Reuters) - Canada added far more jobs than expected last month, lifted by accelerated hiring in the service sector and bringing the unemployment rate down from a three-year high, data from Statistics Canada showed on Friday.
The economy created 40,600 jobs in March, far surpassing economists' expectations for 10,000, and driven by a 35,300 increase in full-time jobs. The unemployment rate declined to 7.1 percent, its lowest level since December.
It was the service sector that contributed the most to the labor market's improvement, led by a 24,900 increase in jobs in healthcare and social assistance. Economists had expected to see a rebound in the sector in March after an outsized decline the previous month.
But there were gains in other service industries as well, including accommodation and food, and professional services. The goods producing part of the economy fared poorly, however, with a 31,800 drop in manufacturing jobs and a loss of 5,500 construction positions.
It was the last piece of economic news ahead of next week's interest rate decision from the Bank of Canada, which is expected to keep rates at 0.5 percent.
Reporting by Leah Schnurr; Editing by Bernadette Baum