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Unemployment rate falls to surprise 7.9%

Blog by Sara Kalke | July 9th, 2010

Unemployment rate falls to surprise 7.9%

The Edmonton Journal reported today that the employment rate is now almost up to 2008 levels, US employment is up, and the "double dip" recession that nay-saying economists were predicting may now be less of a concern. 

What does this mean for the Edmonton Real Estate market? Good news!!! When the economy recovers, so does demand for housing (and new housing prices are starting to stabilize again - http://bit.ly/algqVF - a good sign for the resale market). The risk may be a rate hike (http://bit.ly/d00m6d), as a response to inflation. Either way, mortgage rates are at record lows, and now is a great time to buy or sell a home.

Thinking of selling? Time to buy? Call me anytime - 780-710-7669.  And by the way, I'm never too busy for any of your referrals.

- Sara



Unemployment rate falls to surprise 7.9%

OTTAWA — Canada’s unemployment rate reached its lowest mark in 18 months in June, falling 0.2 percentage points to 7.9 per cent, Statistics Canada reported on Friday.


Canada added 93,000 jobs last month, blazing past the the 15,000-20,000 that economists had been expecting.


It’s the first time since January 2009 the rate has been below eight per cent, the federal agency said, adding that the economy has now recovered almost all of the job losses since 2008.


“You can’t really argue anything in this report,” said Benjamin Reitzes, an economist at BMO Capital Markets in Toronto. “Businesses are confident in our recovery and are hiring. That should get the ball rolling on growth from a private sector perspective.”


The job market has been one of the strongest parts of a Canadian recovery the International Monetary Fund says will lead advanced economies this year. The Bank of Canada raised its key lending rate from a record low 0.25% June 1 after the economy grew at a 6.1% annualized pace in the first quarter. The bank said future moves depend on the balance of domestic growth and an uneven global recovery.


“Employment has been on an upward trend since July 2009, increasing by 403,000 (+2.4 per cent),” Statistics Canada said. “These gains offset nearly all the employment losses observed during the labour market downturn which began in the fall of 2008. The June unemployment rate, however, remained well above the October 2008 rate of 6.2 per cent, due to a large increase in the number of people in the labour force over this period.”


The jobs added in June were equally split between full- and part-time, the agency said, adding that since July 2009 most of the employment gains have been in full-time work, up 355,000 or 2.6 per cent, and part-time work has increased 1.5 per cent.


The job increases were not shared out equally across the country — Ontario, with 60,000 new jobs, and Quebec, with 30,000, accounted for almost all of June’s gains, though six of the other provinces also added jobs. Newfoundland and Labrador actually lost jobs last month, as did New Brunswick.


Five sectors were the principal winners in the job lottery, with the gains split fairly evenly between retail and wholesale (22,000), business, building and other support services (20,000), health care and social assistance (20,000), automotive repair and personal care services (17,000), and construction (11,000).


Manufacturing, on the other hand, lost 14,000 jobs in June and employment in that industry remains about 11.9 per cent below its October 2008 level.


“There’s no arguing with this strong report. The jobs picture clearly shows that the Canadian recovery hasn’t stalled yet, despite signs of slowing momentum in the U.S. and other economies. The handoff from public to private spending looks to be going smoothly, this strong report solidifies our call for the Bank of Canada to raise rates 25 basis points on on July 20,” said BMO Capital Markets economist Benjamin Reitzes in a note.


“Also encouraging was private-sector job growth of 51,900. Over the past four months, the private sector has created 246,200 (+2.3 per cent) new positions, which bodes well for the health of the Canadian economy.”


Statistics Canada also notes that most of the jobs last month (41,000) went to men aged 25 to 54. Workers aged 55 and over took 31,000 of the new jobs, and 21,000 went to those aged 15 to 24.


Read more: http://www.edmontonjournal.com/business/fp/Stunning+jobs+numbers+bolsters+case+rate+hike/3255573/Unemployment+rate+falls+surprise/3255338/story.html#ixzz0tE6mTfLY

 From the Edmotnon Journal, July 9, 2010