- Derek Holt, vice-president with Scotia Economics
Even though Canada's job growth rose in August, the nation's unemployment rate climbed to the highest level this year as more people were looking for jobs. Canada's economy added 12,000 jobs last month, bolstered by a gain in full-time employment, Statistics Canada reported. Nevertheless, the gains were not sufficient to offset an increase of new people searching fro employment, which lifted the jobless rate to 7.0% from 6.8%, where it held steady for six straight months. Economists had predicted the economy to lose 4,500 jobs in the reported month, while the unemployment rate to remain at 6.8%. One of the biggest concerns around Canadian employment remains whether the losses could potentially spread from the resource sector to other industries, especially in the energy-sensitive provinces like Alberta.
The job numbers follow trade data that appeared to be stronger than expected, bolstering the case that the economy is improving after sliding into a recession in the first half of the year. StatsCan said the economy grew in June, raising hopes that the decline was short-lived and that the second half of the year would show growth. The BoC, which makes its next interest rate announcement this week, has estimated the economy will expand at an annual pace of 1.5% in the third quarter before accelerating to a 2.5% pace in the last three months of the year.
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