Skip to comments.Economy not out of woods yet, Harper warns
Posted on 10/09/2009 4:35:16 PM PDT by Clive
OTTAWA - Prime Minister Stephen Harper warned Canadians on Friday not to get too excited about a pickup in job growth, saying the uncertain prospects of the U.S. economy remain a "big concern."
The Canadian economy added 30,600 jobs in September, pushing down the unemployment rate from 8.7% to 8.4%, Statistics Canada reported Friday. The surprisingly robust job numbers included 92,000 new full-time jobs, the biggest increase since May 2006.
The prime minister called the figures "good news," but added the job market could see "a lot of up and down" in the coming months.
"I don't think we're out of the woods," Mr. Harper told reporters in Welland, Ont. "My big concern remains the United States. We saw 30,000 jobs created here last month. We saw once again the loss of over 250,000 jobs in the United States."
Earlier this month, the U.S. jobless rate climbed to 9.8%, as the American economy shed 263,000 jobs.
"These are all great things for us as Canadians to brag about. On the other hand, we have to be realistic that these problems in the United States do continue to create real drags on the Canadian economy," said Harper.
Some economists agreed with the prime minister's assessment.
"This is the sound an economy makes when an economy recovers," BMO Capital Markets deputy chief economist Douglas Porter said in a research note. "Today's report also highlights the deep divide between the North American job markets, with Canada in a much friendlier place."
Trade figures released Friday also suggest the call for caution is merited.
Canada's trade deficit swelled to a record $2-billion in August, as exports to the United States slid by 3.3%.
"The report highlights that Canada's trade rebound continues to be fragile, despite the strengthening recovery worldwide," TD Bank economist Grant Bishop wrote in a note to clients.
The contrasting figures put the Bank of Canada, which has pledged to keep its benchmark lending rate at rock-bottom levels until the middle of next year, in a delicate situation.
The central bank will make its next interest-rate announcement on Oct. 20. Some economists have been calling for the bank to begin raising rates soon, thus gently applying the brakes on the economy to avoid inflation.
Recommendation to Canada: close the border now, before you are overwhelmed by a flood of job seekers fleeing an economically destitute, oppressive, and corrupt regime. ;)