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TORONTO (AP) â¿¿ Canada's unemployment rate edged down one-tenth of a point to 7.0 percent last month, the lowest it's been since December 2008, even while shedding 21,900 jobs, Statistics Canada said Friday.
The federal reporting agency said that a drop in the number of people seeking work pushed the unemployment rate down to a four-year low. Almost 58,000 Canadians left the work force in January or ceased looking for employment, the largest exodus from the labor market since 1995.
The brunt of jobs losses, mostly full-time, occurred in Ontario and British Columbia, while Alberta and Saskatchewan showed modest gains. Many of the losses were in the public sector.
Economists had expected a 5,000 gain in jobs nationally. Analysts had expected a correction in the labor market would come at some point, reasoning that the relatively healthy employment picture in Canada seemed out of step with an economy that had suffered through a rough patch in the last half of 2012.
"Taken by itself the (jobs drop) was bad, but it's hardly a shock given the fact employment seemed to be defying gravity in the second half of last year," said Doug Porter, chief economist with the Bank of Montreal. "This to me is a reflection of relatively sluggish growth in the second half of last year."
Noting that employment is a lagging indicator, which means the data reflects the economy of a few months back, Porter said Canada will be very fortunate to see much growth at all in the next few months.
Economic growth in the third quarter of 2012 fell to 0.6 percent and the Bank of Canada forecasts the fourth quarter won't be much better, coming in at one percent.
The Canadian dollar slipped Friday as low as CA$1.0037 to the U.S. dollar, or $0.9963, its lowest level since January 30, reflecting the weaker-than-expected data.