The expectation of decent job numbers for Canada and the US were met with disappointment when the numbers were released on Friday. The expectation was for Canada to have gained jobs, as we did in November, and the US to stay steady. What actually came through from December was vastly different.
Canada saw a loss of 2,600 jobs last month, while the US saw a drop of 85,000 jobs for the month of December. While the unemployment rate in Canada remained at 8.5%, we did not see the kind of gains that were seen in the previous month.
These unsteady changes in the job statistics are signaling more of a roller coaster recovery than was expected and are causing economists to scale back their predictions in rate hikes. The job loss numbers for December are mirroring the recovery of the recession of the 1990’s which saw large job growth, followed by consolidation.
Despite this hiccup, Economists estimate growth in Canada in the final three months of 2009 to register between 3% and 4%. Many Economists are still looking to the third quarter for the Bank of Canada to raise its benchmark lending rate; however, this remains to be seen.
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