(Adds details, comment by Statscan, economist, byline)
By Leah Schnurr
TORONTO, Aug 12 (Reuters) - The July version of Canada’s market-moving jobs report contained an error and must be restated, the country’s main statistics agency said on Tuesday, pointing to the latest in a series of mistakes that have damaged its reputation in recent years.
Statistics Canada said in a statement that the source of the error has been identified and that corrected estimates will be released on Aug. 15. It did not specify what the error was.
The report, released last Friday, showed the economy added just 200 jobs last month, far fewer than analysts had forecast.
The monthly Canadian employment report, which is similar to the influential U.S. nonfarm payrolls data, is one of the economic indicators that is most closely watched by investors and policymakers. It has showed some big swings between gains and losses in the past.
The mistake will inevitably raise questions about the reliability of StatsCan’s data and whether it paints a true picture of Canada’s economic growth.
There was a disconnect in the second quarter with the labor market underperforming relative to other measures of growth that have strengthened, said Mazen Issa, senior Canada macro strategist at TD Securities in Toronto.
While it is hard to gauge whether the revision will be positive or negative, the fact that StatsCan chose not to wait until next month’s report to issue a revision suggests the change could be material, he said.
“It feels like there’s potentially a larger revision.”
The error happened during one of the agency’s statistical processes, said Sylvie Michaud, director-general of education, labor and income surveys at Statistics Canada.
Michaud, who is directly responsible for the jobs data, said StatsCan was “in the process of rerunning everything”, but that the error was only for July 2014.
It was not the first error for StatsCan. In August last year, the agency uncovered serious errors in a batch of data from its national household survey and pulled the plug before it was released. In 2005, trade figures were revised after a computer error.
StatsCan responded to questions on whether the jobs data was more volatile than usual in a blog post late last year, saying its experts found the survey showed the same degree of month-to-month fluctuation that has been recorded since the 1990s.
The error hurts StatsCan’s reputation, said Benjamin Reitzes, senior economist at BMO Capital Markets in Toronto.
“The labor force survey and employment numbers were already questionable as to their accuracy on a monthly basis given the volatility there,” he said.
Still, whatever the revision is, it is unlikely to change the trend in the jobs market dramatically, Reitzes said.
“The underlying softness that’s there in the Canadian labor market probably won’t change much, if at all.”
The Canadian dollar briefly weakened following the announcement before recovering to end the session little changed from Monday as investors were wary of betting on which direction the revision would go.
StatsCan said it was immediately launching a review of data verification processes in place and that other statistical programs are not affected.
A report on the results of the review will be published on the agency’s website as soon as it is available. Industry Minister James Moore, to whom Statscan reports, declined to comment on the error. (Additional reporting by David Ljunggren in Ottawa; Editing by Amran Abocar, Meredith Mazzilli, Andre Grenon and Peter Galloway)