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Winnipeg Free Press - PRINT EDITION

Recovery picking up steam in Canada, U.S.

By: Paul Vieira

Posted: 12/5/2009 1:00 AM | Comments: 0 (including replies)

OTTAWA -- The so-far tepid economic recovery in North America might have taken its first big step forward in November as Canada's private sector went on a hiring spree and U.S. employers eased up on job cuts.

In Canada, the economy generated 79,100 jobs in the month -- mostly in the service sector -- reversing October's loss of 43,200 jobs and pushing the unemployment rate down to 8.5 per cent from 8.6 per cent. The November job gain, announced Friday by Statistics Canada, was the biggest since September of last year, and supports the view of some economists that robust expansion is expected in the current quarter.

In Manitoba the economy won back 3,100 jobs in November after shedding 3,400 the month before, according to the survey.

Manitoba posted the second-lowest unemployment rate of 5.3 per cent (Saskatchewan is lowest at 5.2 per cent) down from 5.8 per cent in October.

Further, the report revealed the biggest increase in Canadian private-sector payrolls -- of 56,900 -- since January 2008.

"The Canadian economy is in recovery mode," said BMO Capital Markets economist Jennifer Lee.

On Monday, Statistics Canada said the economy grew at an annual rate of 0.4 per cent in the third quarter, marking the official end of recession in the country. However, the growth was far lower than the one per cent economists had forecast and the two per cent predicted by the Bank of Canada.

The central bank has cut its key lending rate to a record low of 0.25 per cent and pledged to keep it at that level well into 2010 -- if inflation does not pose a threat to economic recovery. The Bank of Canada is set to release its latest interest-rate statement on Tuesday.

"In terms of the Bank of Canada, we do not expect the report to engender any meaningful shift on the bank's monetary policy stance when they meet next week," said Millan Mulraine, economics strategist at TD Securities.

"With the unemployment decreasing and the participation rate rising, there is no doubt that the Canadian labour market is improving," said Yanick Desnoyers, assistant chief economist at National Bank Financial.

"Another couple of months of better-than-expected labour market reports and the Bank of Canada could certainly be in the hot spot."

Meanwhile, after 21 consecutive months of recording six-digit job losses, the U.S. Bureau of Labor Statistics said the world's biggest economy shed only 11,000 jobs -- with the jobless rate moving down to 10 per cent from 10.2 per cent.

"This was a surprisingly strong report with details matching the 'wow' factor in the headline print," said Ian Pollick, economics strategist with TD Securities.

-- Canwest News Service / Staff

Northern Manitoba lags

The unemployment rate in the northern Manitoba region is the highest in the country.

Here are some regional unemployment rates from Statistics Canada:

Nfld. and Labrador 20.5*

Eastern N.S. 15.4

Northwestern Quebec 12

Eastern Ontario 8.2

Windsor 13.2

Northern Ontario 12.9

Winnipeg 5.3

Southern Manitoba 6.4

Northern Manitoba 28.7

Northern Saskatchewan 16.3

Northern Alberta 10.2

Northern B.C. 14.1

Yukon Territory 25.0

Nunavut 25

N.W.T. 25

* not including St. John's

Republished from the Winnipeg Free Press print edition December 5, 2009 B6

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