- BMO Capital Markets
Canada's economy lost jobs in February and the unemployment rate climbed to the highest level in nearly three years, as low oil prices continued to undermine the country's resource-dependent provinces. Canada shed a net 2,300 jobs in February, according to Statistics Canada. While the decline appeared to be small, it was enough to push the unemployment rate to 7.3%, up from 7.2% in January, hitting the highest level since March 2013. In contrast, economists had expected a gain of 10,000 jobs and no change in the jobless rate. The biggest drop came in full-time jobs, as 52,000 fewer people were working in the sector, the biggest decline since September last year. The decrease was somewhat offset by new part-time positions, which surged 49,000. Despite this, the data showed a very discouraging sign, as the lack of full-time work indicated a stagnating economy and poor job availability.
The Canadian economy has been hit hard by lower oil prices, which have shrunk the commodity-producing sector and significantly lowered business investment, affecting job growth. The BoC recently pointed out that Canada's job market has been performing well amid the oil price shock. Nevertheless, economists have warned that weak economic growth will eventually stall national employment.
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