Canada outshines U.S. with stunning jobs growth

Fri Oct 7, 2011 4:31pm EDT
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By Randall Palmer

OTTAWA (Reuters) - Canada created six times as many jobs as expected in September, once again outshining the United States with an economy that is humming along even as other rich nations struggle with debt and slumping confidence.

Adjusted to take account of the relative sizes of the two economies and slightly different statistical methods, Canada's stunning gain of 60,900 new jobs, reported by Statistics Canada on Friday, would be comparable to half a million new U.S. positions.

U.S. employment rose 103,000 in September.

"It's a blockbuster report," said TD Securities macro strategist Mazen Issa.

Though Canada's economy contracted marginally in the second quarter, largely due to temporary factors, the country, the world's 10th largest economy, emerged from the last recession in a stronger position than the United States and many other mature economies.

By January, Canada had regained all the 428,000 jobs it lost in the 2008-09 crisis and officials expect modest growth in the second half.

More cautious Canadian banking practices meant there was no subprime mortgage crisis and no government bank bailouts, and consumers kept spending and borrowing. Bank of Canada interest rate cuts after the crisis also helped fuel a housing boom.

Statscan said the jobless rate fell to 7.1 percent in August from 7.3 percent, far below a U.S. unemployment rate that has stayed stubbornly above 9 percent. The U.S. jobless rate was 9.1 percent in September.   Continued...

<p>Skyscrapers loom over a flagpole carrying the Canadian flag in the financial district in Toronto, March 11, 2009. REUTERS/Mark Blinch</p>