Wednesday, May 11, 2011

Canada Elects Grown-Ups; Unemployment Rate Inexplicably Drops to 7.6% One Week Later

Barely a week after the federal elections in Canada that gave incumbent Prime Minister Stephen Harper a majority in Parliament, Statistics Canada announced that job growth had exceeded nearly three times beyond most economists forecasts for the month of April.
Employment rose by 58,300 after a March decline of 1,500, Statistics Canada said today in Ottawa. The jobless rate fell to 7.6 percent from 7.7 percent, as the labor force grew by 47,400. Economists forecast no change in unemployment and 20,000 new jobs in Bloomberg News surveys that had 24 and 25 estimates. The largest estimate was for 40,000 new jobs.

“While one can quibble with the underlying quality of the hiring, given that it was led by part time workers, the overall picture is one of an economy moving gradually back to full employment,” Avery Shenfeld, chief economist at CIBC World Markets in Toronto, wrote in a note to clients.

Most of Canada’s employment gains in April were concentrated in Ontario, the country’s most populous province, and Newfoundland, one of the smallest.

Newfoundland added 3,100 jobs in a province with a working- age population of 429,100, reducing the unemployment rate to 11.1 percent from 12.4 percent, the lowest since comparable records began in 1976.

“Firm crude oil prices and steady production levels are contributing to this impressive performance,” said Sonya Gulati, an economist at Toronto-Dominion Bank.

The province’s jobless rate has fallen 3.8 percentage points since July. The provincial government reported a C$59 million surplus for the fiscal year that ended March 31 as higher oil prices led royalty gains. Newfoundland had earlier forecast there would be a C$194 million deficit.

Ontario added 54,800 jobs in April, Statistics Canada said, and unemployment declined to 7.9 percent from 8.1 percent.
Contrast that with 'unexpected' high unemployment numbers and slow economic growth here in the USA that quite frankly, Stevie Wonder could've seen coming from a mile away.

The 30-year high for Canada's unemployment rate was in December of 1983 at 13.1% while the all time low was in September 2007 at 5.9% [1] - about a year and a half after Harper was sworn in as Prime Minister.

1- Trading Economics interactive chart

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