Canada unexpectedly lost jobs for the first time in five months in August, led by goods-producing industries such as construction and natural resources. Employment fell by 5,500 after rising by 7,100 in the previous month, Statistics Canada said today in Ottawa, and the jobless rate rose to 7.3 percent from July’s 7.2 percent, which was the lowest since December 2008. Bloomberg News surveys called for a job gain of 21,500 and unemployment to stay at 7.2 percent. The almost stagnant job market in July and August follows a second quarter where the economy shrank for the first time since a 2009 recession. The Bank of Canada said two days ago the need to raise interest rates has “diminished” because a fading global recovery will ease inflation pressures in Canada. “These weaker than expected results will feed into fears that the Canadian economy will not rebound as sharply from its second quarter dip as policy makers would like to see,” Avery Shenfeld, chief economist at Canadian Imperial Bank of Commerce, wrote in a note to clients. The Canadian dollar depreciated 0.3 percent to 99.23 cents per U.S. dollar at 7:27 a.m. in Toronto, from 98.95 cents yesterday. One Canadian dollar buys $1.0077. Goods Producers Drop Work in goods-producing industries fell by 40,100 in August and rose by 34,600 in services, today’s report said. Construction companies fired 24,300 people to lead the decline, followed by 11,500 workers from natural resources firms. Private sector employment fell by 20,600 while government jobs rose by 22,000. Health care and social assistance jobs rose by 50,100. Transcontinental Inc. said Aug. 30 it will fire about 30 workers as it moves some printing equipment to a central location in Montreal. “Our first priority is to move our economic recovery forward, and ensure Canada’s economy continues to create jobs,” Prime Minister Stephen Harper told a meeting of Conservative Party lawmakers yesterday. The U.S., which buys three-quarters of Canada’s exports, reported no increase in employment last month. Charles Evans, president of the Federal Reserve Bank of Chicago, said Sept. 7 the Fed should move “aggressively” to reduce unemployment, even at the cost of temporarily pushing inflation higher. Canadian average hourly wages rose 1.4 percent in August from a year ago, repeating the July pace that was the slowest June 2003. Full-time employment rose by 25,700 and part-time jobs fell 31,200, the report said. The number of self-employed workers fell by 6,900 and those working at corporations rose by 1,400. To contact the reporter on this story: Greg Quinn in Ottawa at gquinn1@bloomberg.net To contact the editors responsible for this story: Christopher Wellisz at cwellisz@bloomberg.net; David Scanlan at dscanlan@bloomberg.net.

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