U.S. unemployment rate highest since 1998 - Canada's job rate remains steady

We have not seen the end to job-letting on both sides of the border, says deputy chief economist for Scotiabank

At 4.5 per cent, the unemployment rate in the United States is the highest it has been since 1998.

Manufacturers continued to suffer heavy losses in June and the demand in service industries fell to its lowest level in nearly a year. Businesses are slashing payroll for the second time since April.

More than 114,000 U.S. jobs were cut in June (165,000 were cut in April). The unemployment rate is the latest economic ailment in the country’s year-old economic slowdown.

"I think the troubles that we're seeing in the U.S. - the uncompetitiveness of American industries, especially on the manufacturing side - are going to lead to more job-letting going forward," Aron Gampel, Scotiabank's deputy chief economist told robtv.com Internet television Friday.

"(U.S.) businesses are having a hard time and eventually that's going to filter through to reduced job opportunities."

In Canada the number of new jobs is down but the unemployment rate has remained stable at 7 per cent. While we are doing a little better than the U.S. in terms of the stability of our unemployment figures, year over year the economy is slightly depressed.

"We have been slowing down, both in terms of aggregate GDP growth and employment growth," said Gampel. "Manufacturing continues to lose jobs. Clearly we have not seen the end to job-letting on both sides of the border and in fact I think it's probably going to intensify over the summer."

Other labour figures for Canada

According to Statistics Canada:

•Part-time employment for men grew last month (for women it remained unchanged).

•The proportion of summer students with a job in June was 48.4 per cent, up over last year. While the summer job market improved considerably for students in their 20s, it dropped for teenagers.

•Jobs in the public sector increased in June by 105,000 jobs. In the public sector the number of jobs dropped by 25,000.

•Although the number of self-employed workers was almost the same in June as in May, year-over-year it has dropped.

•Canadian constructions firms hired 8,000 more employees since last October, when the new positive trend began.

•Employment is also trending up in professional, scientific and technical services (10,000 more jobs).

•Employment in manufacturing is down, part of a trend that began at the start of 2001. Declines have been centred in computer and electronic parts, transportation equipment, wood products and clothing.

For more information about the job market, including provincial break-downs, take a look at The Labour Force Survey on Statistics Canada's Web site, www.statcan.com.

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