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Loss of 20,000 private sector jobs in October; and,15,000 reduction in self-employed persons

Canada’s job market tightens in October, what does that portend



An article Friday reported that in October Canada added only a net 1,800 jobs when economists had been expecting a net gain of 10,000. This where 37,000 government jobs were added in October. The offset is found in a:
  • loss of 20,000 private sector jobs in October; and,
  • 15,000 reduction in self-employed persons.
Concurrently, the work force is said to have increased by 18,000. It is coincident that 18,000 is a multiple of 1,800 where those two numbers pertain to different statistics. For me, the following things ‘jump out of the table’ and ought to hit one squarely in the forehead:

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  • the total government 12 month jobs reduction number is extremely surprising. If this number is accurate it says that U.S. Federal, State and Local Governments collectively have for all intents and purposes not reduced net employment in the past twelve months. I find that hard to believe in circumstances where many, if not virtually all, of those Governments are running annual deficits, and where Government jobs are said to total 16.5% of all U.S. jobs at October 31;
  • while that the numbers say that private sector ‘service-providing’ ‘businesses’ have been greater job creators in the past 12 months than have private sector ‘goods-producing’ businesses (including construction and manufacturing) is no surprise, I find the extreme relationship of job creation between those two broad sectors very disconcerting. Essentially this means, if I am right in my view as to:
    • the importance of manufacturing to country-specific economic growth, and
    • the comparative unimportance of service jobs to country-specific economic growth
all the talk about job creation and economic recovery in America is political rhetoric and meaningless economist-speak – and in the word’s of William Shakespeare, ‘much ado about nothing’. All the foregoing in aid of my belief that if you participate in the financial markets you should weight what you listen to and read about U.S. (or any other country) labour and unemployment statistics with at least a ‘few grains of salt’ in the context of country-specific long-term economic growth. Topical References: United States Department of Labor, from The Bureau of Labor Statistics, November 2, 2012 – reading time open-ended. Also see:


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Ian R. Campbell -- Bio and Archives

Ian R. Campbell, FCA, FCBV, is a recognized Canadian business valuation authority who shares his perspective about the economy, mining and the oil & gas industry on each trading day. Ian is also the founder of Stock Research Portal, which provides stock market data, analysis and research on over 1,600 Mining, Oil and Gas Companies listed on the Toronto and Venture Exchanges.
Note: The Commentary and information above is provided ‘AS IS’ and solely for informational purposes, not for trading purposes or advice.


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