By Akhil Shah

OTTAWA (MNI) – On the heels of a surge of 61,000 jobs gained
in September, Canadian employment for October is expected to have grown
further, but only modestly, Statistics Canada is likely to report on Friday.

Economists surveyed by Market News International expect employment
to have grown by a median 10,000 jobs with the annual unemployment rate
remaining at 7.1%. However, individual analyst expectations range from a
loss of 5,000 to a gain of 20,000 jobs.

September’s sudden growth was a result largely of a one-time lift
from new educational hires as schools and universities reopened. This
sector accounted for nearly 40,000 new jobs, pushing the total growth
for the month to 61,000. Other sectors that contributed to the increase
were professional, scientific and technical services (+35,600) and
accommodation and food services (+30,700). The rise was restrained by
declines in finance, insurance, real estate and leasing sector along
with information, culture and recreation sector.

Despite the surge in September’s employment, the third quarter saw
a growth of 62,500 jobs, with employers shedding 5,500 jobs in August
and adding 7,100 in July.

A report released by the Toronto Dominion Bank (TD Economics)
expects sectors besides educational and professional services to do much
of the heavy lifting in October. However, the report added, “there does
not appear to be a sector poised for a large increase in hiring in
October, which will keep the overall headline subdued.”

Michael Gregory, a senior economist at the Bank of Montreal (BMO),
expects temporary jobs created during several provincial elections to
provide hiring support in October. The bank expects a 15,000 increase in
employment, largely from temporary jobs, but declines in professional,
scientific and technical services along with nonfarm natural resources.

In a research report to clients, Peter Buchannan, a senior
economist at the Canadian Imperial Bank of Commerce (CIBC) wrote that
uncertainties in the Euro zone and fears of a U.S. recession are likely
to prompt firms to temporarily put aside plans to hire new staff. This
is despite latest responses from the Bank of Canada’s autumn business
outlook survey pointing to positive hiring intentions.

The Canadian Employment Quality Index, an index released by CIBC to
measure both the compensation and stability of jobs, recorded a 0.5%
slide in the third quarter, reaching to a level last seen at the eve of
the recession.

The index was also down 1.5% over the past seven months. Despite
paid-employment risings faster than self-employment and full time job
creation outpacing part-time job creation, the index slid lower because
full time jobs created during this period were in low-paying sectors.

Looking forward, the bank expects the employment quality in the
coming months to moderate further with public sector hiring expected to
slow more; particularly activity in the public sector construction. This
softening will limit growth in high quality construction jobs in the
coming twelve months the report said.

— Akhil Shaw is a Need to Know News reporter in Ottawa

** Market News International Ottawa **

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