Canada bleeds more jobs in July, recovery in doubt
By Louise Egan
OTTAWA (Reuters) - Canadian job losses in July were more than double what had been expected as employers cut workers even though the economy is commonly thought to be on the mend after its worst recession since the early 1990s.
Statistics Canada said on Friday the economy suffered net job losses of 44,500 in the month, compared with the market's consensus forecast of a 17,500 decline. The construction industry bled the most workers, followed by food and accommodation services, while factory workers were largely spared.
The unemployment rate remained unchanged from June at an 11-year high of 8.6 percent as fewer people stayed in the labor market looking for work.
The Canadian dollar fell to a one-week low against its U.S. counterpart after the report, hitting C$1.0851 to the U.S. dollar, or 92.16 U.S. cents. It later recovered slightly to trade at C$1.0810, or 92.51 U.S. cents.
The dismal numbers may push some economists to push back their forecasts of an economic turnaround this quarter.
"This indicator suggests that economic recovery needs to be pushed off perhaps a little further," said Eric Lascelles, chief economist at TD Securities.
The Bank of Canada and most private-sector economists say the economy will start to grow in the third quarter after three quarters of contraction. The central bank projects 1.3 percent growth in the July-September period.
"This report may cloud their view a bit," said Sal Guatieri, senior economist at BMO Capital Markets in Toronto. Continued...