Canada's economy lost 55,200 jobs in July compared to the previous month with many people leaving the work force -- the worst single-month drop since the recession of the early 1990s.
Statistics Canada also reported on Friday a dip in the national unemployment rate to 6.1 per cent from 6.2 per cent in June. That's because many people -- especially younger part-time workers -- left the workforce.
Most of the job losses, which totaled 48,000 in July, came from part-time positions in the manufacturing, business building, and support and educational services sectors.
Employment across the country grew by 1.3 per cent over the past year, but the pace of growth has slowed sharply in recent months. Job gains have averaged only 10,000 a month so far in 2008, compared with an average monthly gain of 30,000 in 2007.
Business News Network's Michael Kane said economists he spoke with are cautioning people not to overreact to the numbers.
"Ever since the end of last summer we have seen blow away numbers on the job creation side. So does two months make a trend?" he said. "This is what we don't know." What we do know is the negative effect the report has had on the dollar, he added.
The loonie fell nearly 1.25 cents to well below 94 cents on Friday, its lowest level in about a year, after the weak jobs report and falling oil prices.
The job losses happened in Quebec, Ontario, Saskatchewan and Prince Edward Island. Quebec lost 30,000 jobs and the provincial jobless rate rose to 7.4 per cent. Ontario lost 19,000 jobs, although its unemployment rate actually dropped to 6.4 per cent from 6.7 per cent when about 42,000 people left the job market.
"Keep in mind that when economies slow down a little bit, a lot of people actually enroll in universities and do self-enriching things so that they're better prepared to compete in a job market," said Kane, about some positives that some economists are gleaning from the StatsCan report.
Canadian Labour Congress President Ken Georgetti, however, calls the numbers a catastrophe for working families. He says in a statement that the federal government needs a forceful jobs strategy -- a made-in-Canada plan to create and keep jobs in this country.
The only significant job gains were in accommodation and food services, where 22,000 people were hired across the country.
Over the past year, manufacturing jobs dropped by 88,000 in Canada. They continued to disappear in July, with Ontario losing 41,000 such jobs. Alberta, however, added 7,000.
While Ontario lost factory jobs, there were gains in public administration, health care and social assistance, construction and educational services.
Losses for July were significant for private sector employees, while the public sector saw some gains. Since July 2007, jobs in the public sector went up by 6.1 per cent, compared with 0.5 per cent for the private sector.
