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OTTAWA - Canada's economic recovery is suddenly looking vulnerable after Statistics Canada shocked observers Friday with new data showing the country lost 71,000 jobs last month.
The October figure was the third major economic indicator that has surprised well to the downside since the Bank of Canada declared the recession over in July.
But the grim jobs data - glossed up by a 27,500-gain in self-employment that brought the net loss to 43,200 - puts into question the previous two months of reported gains.
In conjunction with gross domestic product readings of zero growth in July and a 0.1 per cent shrinkage in August, the growth predicted for the third quarter appears to have vanished into thin air.
No economist now believes Canada will come close to matching the U.S. third quarter growth of 3.5 per cent when Statistics Canada reports later this month. And, some say, the quarterly GDP data may show that Canada did not emerge from the recession at all.
"Technically, we could still be in recession," agreed Michael Gregory of BMO Capital Markets.
"You are in recession until there is evidence you are not."
David Rosenberg of Gluskin Sheff + Associates said in a email that if the slump has ended, "it is the mother of all jobless recoveries."
Even Human Resources Minister Diane Finley hedged on whether Canada has emerged from the recession that began a year ago.
"In the last two months when we saw declines in unemployment, we cautioned people about getting overly optimistic too soon," she said in an interview.
"Unfortunately, we are not out of the woods yet. But then we are nowhere near the position originally forecast a year ago when they were saying there could be as high as 10 per cent unemployment."
Most economists still believe September growth will rescue Bank of Canada governor Mark Carney from a forecasting embarrassment.
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