Canada's jobless rate drops on heavy hiring

A hiring frenzy in Canada's oil patch pushed the unemployment rate to near a 30-year low in October in an unexpectedly strong jobs report that is likely to stall any interest rate cuts by the Bank of Canada.
Statistics Canada said on Friday that roaring economic growth in resource-rich Alberta pushed the jobless rate down to 6.2 in October from 6.4 percent in September after a heftier-than-expected 50,500 new jobs were created last month.
Analysts in a Reuters poll had forecast modest job growth of 15,000 and no change in the jobless rate. The October unemployment rate was just above a 30-year low of 6.1 percent reported in June.
"A stunningly strong report," said Marc Levesque, chief strategist at TD Securities. "Across the board, I don't think this is going to change anything from the Bank of Canada's perspective." The central bank has held interest rates steady at 4.25 percent since May on expectations that inflation and growth will meet its medium-term targets.
The Canadian dollar jumped immediately after the report to C$1.1297 to the US dollar, or 88.52 US cents, up from pre-data levels of around C$1.1340, or 88.18 US cents. Domestic bond prices slipped deeper into negative territory.
Average hourly wages of permanent employees, which is closely watched by the Bank of Canada for signs of inflation, rose 3.1 percent in October from a year earlier, down from 3.4 percent growth in September.
Lay-offs in the hard-hit manufacturing sector, which saw a brief respite in September, were offset by more jobs in construction, education, business, building, public administration and other support services, Statscan said.
Of the total jobs added, 22,600 were in Alberta, where hiring surged in construction and educational services as well as in the oil patch. The provincial unemployment rate fell to a 30-year low of 3.0 percent and for adult men it was 1.8 percent.
British Columbia also outpaced the rest of the country with the second-largest job gains of 13,300. October was the second straight month of job gains after a three month downturn that had pointed to a softening in the labour market alongside an economic slowdown.
Economic growth slowed to 2.0 percent in the second quarter from 3.6 percent in the first, and is expected to remain at about 2 percent growth through to the end of the year.