Jobless rate falls for first time in a year

CTVNEWS

Unemployment rate falls for first time since recession

CTV.ca News Staff Published Friday, October 9, 2009 6:50PM EDT Last Updated Friday, May 18, 2012 11:59PM EDT

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In what might be the clearest indication yet that Canada's labour market is recovering faster than expected, Statistics Canada reports that the country's jobless rate fell for the first time in nearly a year last month, to 8.4 per cent.

That's down from 8.7 per cent in August.

Employment increased for the second consecutive month, up 30,600 in September, driven by large gains in full-time positions.

Statistics Canada said 91,600 full-time jobs were added in September -- the largest number since May 2006. That more than compensated for the 61,000 loss in part-time employment.

The increase in full-time work was mainly among youths and women aged 25 and over and in Ontario.

The September jobs pick-up was five times larger than the economist consensus forecast of 5,000. That, along with a slight decrease in the number of workers looking for jobs, helped drop the national unemployment rate by 0.3 percentage points.

"Since the peak in October 2008, employment has fallen 2.1 per cent (357,000), with the bulk of the decline occurring between October and March 2009," the agency noted.

"Since then, the trend in employment has levelled, with the number of employed almost the same in September as it was in March."

Construction, manufacturing and educational services saw employment increases in September. Employment in manufacturing has had the sharpest rate of decline since the start of the labour market downturn in the fall of 2008, down 10.6 per cent.

Prime Minister Stephen Harper reacted to the employment numbers cautiously.

"We have some good news today, (but) I don't think we're out of the woods," Harper said, speaking in the Niagara region.

"My big concern remains the United States," he said. "We saw once again the loss of over 250,000 (jobs) in the United States."

Persisting employment problems south of the border "continue to create real drags in the Canadian economy," Harper said.

The Canadian numbers weren't all good news. Jobs disappeared in the transportation and warehousing sectors.

But workers in education services also saw improvement with 18,000 jobs added to the sector last month. The increase coincided with students returning to schools, colleges and universities following the summer break.

British Columbia, New Brunswick and Prince Edward Island were the only provinces with notable employment gains in September. In Ontario, employment rose slightly as large full-time gains were dampened by losses in part time.

Nova Scotia, Quebec and Manitoba saw outright job losses.

The figures suggest that many are now seeing clearer skies ahead.

"I think these numbers, in their totality, reflect the Bank of Canada doing the heavy lifting with dropping (interest) rates to levels that we've never seen in our lifetime," Aaron Gampbel, vice president and deputy chief economist for Scotiabank, told CTV's Poweplay on Friday afternoon.

"They've enabled people and business to refinance, they've enabled people to pay down debt, they've enabled people to come back and actually borrow to buy," he said. "This is a very positive turnaround. I think it does indicate that we are transiting from recession to recovery. And what could be better than that?"

Economists consider employment a lagging indicator because employers usually will wait until they see clear signs that a recovery is underway and will be sustained before beginning to re-hire.

By contrast, the U.S. is still reporting massive monthly job losses even though most believe the economy there has turned the corner and begun to grow.

Here's what happened provincially (previous month in brackets):