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Labour market “back on track”

by Archives September 16, 2008

Canada’s employment rate rebounded slightly after a significant drop in July according to Statistics Canada’s latest labour force survey.
“The Canadian labour market is somewhat back on track in August after a disappointing July,” said Laurentian Bank economist Sébastien Lavoie.
“People were scared, after more than 50,000 jobs were lost in July, that perhaps the Canadian labour market is disintegrating,” Lavoie said.
The August numbers suggest this is not the case – 15,000 jobs were created last month.
According to Statistics Canada all of the gains in August were in full-time positions.
More full-time jobs indicate that workers are earning more money. Whether they spend the extra income or save it, they are contributing to the economy, helping to make it stronger.
“It’s better for economic growth and consumer spending,” Lavoie said.
Most of the employment gains in August were in the private sector while the public sector experienced a loss.
The strength of the private sector is a good indicator of the economy’s overall strength.
Despite the employment gains in August the unemployment rate remains unchanged at 6.1 per cent.
Lavoie said the unemployment rate is expected to reach 6.5 per cent by the end of the year.
“Employment is increasing, but the number of people looking for jobs is increasing faster. Unemployment tends to increase during a slowdown in any economic period.”
Lavoie said economists are forecasting a continued increase in employment for the remainder of the year. But the growth will be relatively modest – only 5,000 to 10,000 jobs per month – because the economy is in a “slow-down period.”
It will take a while to regain the jobs that were lost in July but, says Lavoie, “for the year 2008 the overall drop will be quite modest.”

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