Canada’s employment report of November marks the worst since the recession of 2008-09

Canada’s employment report of November marks the worst since the recession of 2008-09
Written by:
Michael Harris
7th December 2019
Updated: 11th March 2020
  • Canada's employment report marks the worst since 2008-09's recession.
  • Employment slumped by 71.2K in November.
  • Unemployment rate rose to 5.9% in November.
  • Labor Force survey highlights that the participation rate has dropped to 65.6%.
  • USD/CAD gained from 1.31727 to 1.3270 level following the report.

The economic data announced on Friday hinted at the troubles that the Canadian economy is currently facing. At 13:30, Canada released its employment change and unemployment rate reports, both of which missed the analysts’ forecast. Following the reports, the National Bank of Canada’s analyst, Matthieu Arseneau, stated on Friday that the current employment data marks the worst it has been since the last recession in 2008-09.

Canada’s Employment Slumps By 171K In November

Canada’s employment had slumped 1.8K in November. In an earlier estimate, analysts had forecasted the employment to report sharp gains to 10K in November. Missing the expectations by a significant margin, the Labor Force survey reported a massive plunge in Canada’s employment by 71.2K last month. Consequently, Canada’s unemployment rate saw a remarkable increase in November.

Unemployment in Canada was reported at 5.5% in October. Financial experts had anticipated the unemployment rate to stand steady in November. As per the report, however, the unemployment rate in Canada rose to 5.9% last month. As per the National Bank of Canada, this marks the highest it has been in the past 15 months.

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The Labor Force survey further highlighted that the participation rate has also decline to 65.6%, as of November. According to Arseneau, expectations were already quite low for Canada’s economic data in November. Missing the lowered anticipations, the data points at the rising challenges that the economy is currently facing.

Arseneau Says The Global Economic Uncertainties Are Slowly Starting To Fade Away

Arseneau further highlighted that the global economic uncertainties have slowly started to fade away. The probability of the UK’s departure from the European Union without a deal is at an all-time low, while the Washington and Beijing continue to signal progress in terms of a trade deal between the two largest economies of the world, despite the previously risen complications. He further added that in light of the fading macro uncertainties, the data could have been more gruesome for the economy if it hasn’t had a good run in the first half of 2019.

Despite the drop, the survey reported 285K new jobs (86% full-time) in 2019 that marks the second-best figure in the past decade.

The impact of the yesterday’s data on the forex market remained largely downbeat. USD/CAD pair was reported to have hiked from 1.31727 level to a daily high of around 1.3270. As per the forex analysts, the gain retreated much of the loss that the pair noted earlier in the week following BOC rate statement that rendered incredible strength to the Canadian dollar.

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