Canada hit by biggest monthly job loss in 17 years

Fri Aug 8, 2008 3:57pm EDT
 
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By Randall Palmer

OTTAWA (Reuters) - A surprisingly large 55,000 jobs were lost in Canada in July, the biggest monthly job loss since the 1991 recession.

The Canadian dollar dropped immediately and bonds rose in reaction to release of the Statistics Canada employment report on Friday morning. Economists called the figures "extremely ugly" and "stunningly bad."

Most of the losses, 48,000, were in part-time work and overall employment remained 227,000 higher than it was a year earlier. The jobless rate dropped to 6.1 percent from 6.2 percent as youth and some older people left the work force.

"There is no question the economy is slowing," said BMO Capital Markets senior economist Michael Gregory.

But he said: "We're nowhere near the 1991 recession... The numbers are so extreme that it leads you to believe that maybe there's some statistical anomalies going on here."

The median estimate by analysts surveyed by Reuters had been for a gain of 5,000 jobs in July following a loss of that magnitude in June.

More than half of the jobs lost, 32,000, were in the factory sector. The province Ontario, Canada's industrial powerhouse, shed 41,000 factory jobs. Manufacturers have been hit hard by the impact of the strong Canadian dollar.

In neighboring Quebec, also heavily industrialized, the unemployment rate rose to 7.4 percent from 7.2 percent.   Continued...

 
<p>In this file photo GM employees assemble Chevrolet Impalas at the GM Oshawa Assembly Plant, June 19, 2007. A surprisingly large 55,000 jobs were lost in Canada in July, the biggest monthly job loss since the 1991 recession. REUTERS/J.P. Moczulski</p>