Canada's October employment figures hold steady

Job growth in October was relatively flat as an increase in full-time work was mostly cancelled out by losses in part-time employment, Statistics Canada said Friday.

The unemployment rate edged up 0.1 percentage points to 6.2 per cent, driven up by an increase in the number of people looking for work.

The country added 9,500 jobs last month, when economists had been expecting to see job losses totalling10,000.

In September, Canada added 107,000 jobs, with the vast majority of them coming in part-time work.

The Oct. 14 federal election spurred strong employment growth in public administration last month. Roughly 40,000 jobs were added in the sector, with the additions spread across the country.

However, employment declined by about 27,000 jobs in the accommodation and food services sectors. The decline was mostly in food services and drinking places, with the bulk of the losses occurring in Ontario and Quebec.

There was little change for all other industries, Statistics Canada said.

Employment increased by 15,000 in Alberta, which continued to have the lowest jobless rate in the country, at 3.7 per cent. There was little employment change in the other provinces.

Economists said the October job report showed the resilience of the Canadian economy in the face of the downturn that has gripped the United States and economic turmoil in other parts of the world.

"Landing deep in the heart of October’s financial market turmoil, the stability in Canada’s latest jobs survey is impressive, even if the numbers were heavily bolstered by election-related hiring," said BMO Capital Markets economist Douglas Porter.

"After all, this modest gain follows a record rise in the prior month. If there was any lingering doubt that Canada’s economy is faring better than the U.S. — so far — this two-month performance should quash it," Porter said.

Paul Ferley, an assistant chief economist at RBC Economics, added that the credit crunch and the U.S. slump are "expected to start having a more dominant impact on Canada’s labour market data going forward."

Economists were mixed in their outlooks over the effect the October jobs report will have on the Bank of Canada's stance on interest rates. Porter said the report will take some pressure off the central bank to cut interest rates even more aggressively, while Ferley forecast a cut of one-quarter of a percentage point in December, with "stimulative conditions" to persist through most of 2009.