Canada’s labour market will strengthen in the second half of 2016 as the first round of Ottawa’s new Canada Child Benefit cheques boosts consumer spending and improves the pace of hiring among service sector employers, according to TD economist Leslie Preston.

“We are expecting stronger growth in the second half, particularly those Child Benefit deposits that went out in July will boost spending for many households,” she told CTV News Channel.

The federal government has said eligible families will see an average increase of $2,300 in the 2016-17 benefit year.

Economists were caught off guard by Statistics Canada’s latest labour force survey on Friday.

The agency said Canada’s economy shed 71,400 full-time positions in July, the biggest one month drop in full-time work in five years. Those losses were partially offset by an increase of 40,200 less-desirable part-time jobs. The unemployment rate edged up to 6.9 per cent from 6.8 per cent.

A consensus of economists had predicted the country would add 10,000 jobs, according to Thomson Reuters.

“It’s certainly a disappointment. There is no doubt about it. We were only expecting a modest gain in jobs. So to get a big loss is surprising,” said Preston.

She says the so-called soft categories like health, social services, and business support will carry the bulk of the job gains, while the energy sector continues to sputter under the weight of weak oil prices.

The service sector lost a total of 26,900 jobs last month. Within that category, health care and social assistance employment added adding 28,300 positions, while public administration jobs were hardest hit, shedding 24,200.

Preston warns against reading too much into the highly volatile monthly job numbers. She notes the massive wildfire that swept across Southern Alberta, shutting in millions of barrels of crude production, continued to sap strength from the economy through the second quarter.

With files from The Canadian Press