OTTAWA - Jobs are disappearing in Canada at a rate not seen since the deep recession of the early 1980s, new figures show.
Statistics Canada reported Thursday that Canada lost another 61,300 jobs in March, taking the unemployment rate up three-tenths of a point to eight per cent for the first time in seven years.
Since the peak in October, employment has fallen each month for a total of 357,000 jobs lost, representing 2.1 per cent of the workforce. That's a pace of contraction greater than at any time during the 1991 recession and equalling that of the more severe 1982 slump.
In some ways, today's job losses are even worse, CIBC chief economist Avery Shenfeld explained.
Compared to the early stages of the previous two recessions, the first five-month decline is roughly about three times the pace of deterioration.
"Obviously this is not good news," Prime Minister Stephen Harper said from Edmonton.
"On the other hand, this is the level of unemployment we were expecting in the budget. That's why we've come forward with the kind of programs and dollars we have to deal with this problem," he added, referring to the budget's $40-billion over two years stimulus.
The only good news, said economist Douglas Porter of BMO Capital Markets, is that last month's losses were not as "horrid" as in January and February, when 129,000 and 83,000 jobs were lost respectively.
"In many ways this report was absolutely a textbook case of what you see in the middle of a recession," Porter said. "We saw many deep declines in manufacturing, we saw deep declines in construction and we saw back-up in the unemployment rate."
Economists had been expecting another poor jobs report with about 55,000 jobs lost.
The reality was slightly worse in the headline number, and much worse in the details.
All of the job losses were in the private sector and the loss in full-time employment was even higher at 79,500 in March -- offset partly by a pick-up in part-time work.
Rising part-time work at a time of falling employment is usually an indicator that Canadians are settling for whatever jobs they can find, economists say.
One explanation for the sudden reversal in Canada's job market, which was robust until last September, is that employers held off downsizing as long as they could in the hope that a worldwide downturn would bypass Canada, suggested Derek Holt of Scotia Capital.
That hope has become illusionary and by most accounts Canada has just gone through the worst quarterly economic retreat since the Second World War, with an output contraction of about eight or nine per cent.
Canada's employment picture is now in lock-step with the U.S., which has been shedding upwards of 600,000 workers a month for some time.
Holt said the quick pace in which Canada is current shedding workers points to a downside risk that labour market contraction this year will be worse that even the more dire predictions so far.
"While we've spoken to the risk of a half-million hit to employment this year, we're raising our views on the risks to the three-quarter million mark," he said.
Labour spokesmen called on Finance Minister Jim Flaherty to revisit the employment insurance system, saying with 1.5 million Canadians out of work and prospects gloomy, too many Canadians are falling through the cracks or receiving inadequate benefits.
"The numbers are stunning," said Canadian Labour Congress president Ken Georgetti, "but what really annoys us is that the percentage of unemployed Canadians receiving EI is actually declining."
He said the latest available data shows that only 42.8 per cent of unemployed Canadians were receiving EI benefits in January, down from 44.4 per cent in December 2008.
Erin Weir of the United Steelworkers said a big part of the problem is that in some low-unemployment regions, 700 hours of accumulated work is needed to qualify for benefits, which he called too many under the current circumstances.
He urged that the requirement be dropped to 360 hours for all regions, regardless of the jobless rate.
Weir said the previous experience during the past two recessions shows that unemployment keeps rising long after the economy starts rebounding as employers hold off hiring until they are certain the recovery is for real.
The rule may hold for jobs, but Holt says the current recession is broader in its impact across the country than the last two downturns. The jobless rate hit 13 per cent in the 1981-82 recession and approached 12 per cent in the early 1990s downturn.
"Every major sector of employment across all regions of the country is downsizing," he said, and some of those jobs, particularly in manufacturing, may never return.
To underline the point, British Columbia and Alberta were hit the hardest in March, losing 22,600 and 14,900 workers respectively.
By comparison, manufacturing-heavy Ontario got off lightly with only 11,000 fewer workers, although in the full-time category the province lost a sizable 39,600 jobs and it continues to lead the country with a 171,000 jobs contraction over the last five months.
As has been the case for several years, manufacturing continued to be among the weakest sectors, shrinking by 34,000 workers last month.
Since October, Canadian manufacturers, mainly in the auto and forestry sectors, have shed 134,000 jobs, or 6.8 per cent of the workforce.
But there was plenty of pain in most industries in March -- construction dropped 18,000 and is now down 99,000 jobs since October. Meanwhile, natural resources shed 11,000 workers led by losses in mining, and oil and gas extraction industries in Alberta; finance, insurance and real estate fell 20,000, while accommodation and food services dumped 15,000 workers.
Surprisingly, hourly wages did not seem to be overly affected by the weak jobs market. Statistics Canada said average hourly wages were 4.3 per cent higher than a year before.
