Canadian job market better than expected in December

OTTAWA — Canada’s job market performed somewhat better than expected last month, with gains concentrated in full-time, private-sector employment, in industrial sectors and for those younger than 25.

There were 22,000 additional people working in Canada last month, Statistics Canada said Friday. That slightly exceeded economists’ expectations for gains of 20,000.

Most experts anticipated a surge in people looking for work would cause the unemployment rate to rise to 7.7%, but it remained steady at 7.6%.

The gains for December came from full-time employment, which provided jobs for 38,000 more people last month.

Prime Minister Stephen Harper said the December jobs report was “encouraging,” but unemployment rates “remain too high.”

“There are still significant challenges in the global economy and our export markets … that threaten the global economy and threaten our own recovery,” Harper said during a news conference Friday in Welland, Ont.

Notable gains were seen in the sectors of manufacturing, transportation and warehousing. Declines were seen in areas such as construction, health care and social assistance, wholesale and retail, and agriculture.

In fact, employment in industrial sectors such as manufacturing, and transportation and warehousing, which was up 65,700 and 44,500, respectively, were their highest gains on record and took some economists by surprise.

Douglas Porter, deputy chief economist at BMO Capital Markets, said “the huge gains in factory and transportation jobs provide a tantalizing hint that the upturn in the U.S. economy is spilling over into Canada.”

“While the result won’t make a big impact on Bank of Canada policy, it solidifies our view that the bank will start tightening before mid-year,” he said.

There were 52,500 more people working in the private sector, 7,400 more in the public sector and 38,000 fewer people self-employed.

There were strong employment gains in Ontario, Quebec, and Newfoundland and Labrador, though British Columbia lost jobs. All three northern territories saw job gains during the last three months of the year, Statistics Canada noted.

December’s job gains were largely concentrated in the youth category, or those 15 to 24, for which 26,000 jobs were created. Statistics Canada said employment levels were largely flat among other age groups.

Some observers said specific details of the December jobs report were more encouraging than the overall job gains.

Pascal Gauthier, TD Economics chief economist, noted that December was Canada’s strongest month for job gains in five months, and that the fourth-quarter monthly gains averaged 13,000, up from 6,600 in the third quarter.

“December’s headline job creation figure lines up well with our forecast for a pickup in economic growth in the fourth quarter from a lowly performance in the third quarter,” Gauthier said in a report.

Statistics Canada said that for 2010 as a whole, Canada’s job market expanded by 2.2 per cent, or 369,000 people. That compared to a decline of 1.1% in 2009.

TABLE

December unemployment rates by province:

Newfoundland and Labrador 13.7%

Prince Edward Island 11.9%

Nova Scotia 10.4%

New Brunswick 9.4%

Quebec 7.6%

Ontario 8.1%

Manitoba 5.2%

Saskatchewan 5.5%

Alberta 5.6%

British Columbia 7.6%

Overall 7.6%

Source: Statistics Canada