Canadian and American employers reduced costs by cutting hundreds of thousands of jobs in November.
There were 71,000 jobs lost in Canada last month—the largest number since the recession in 1982. And the unemployment rate rose 0.1 percentage points to 6.3%, its highest level in two years.
“With their businesses already feeling the pinch from the credit crunch and a slowdown in demand, employers are clearly adjusting to new economic realities by trimming costs and payrolls,” says CIBC World Markets. “More is to come on that score as the economy contracts this quarter and possibly [the first quarter of 2009].”
The manufacturing sector was hard hit in November, with a net employment drop of 38,000. This brings manufacturing declines to 388,000 since the peak in 2002. In Ontario, the employment declines in this sector totaled 42,000 in November.
Other industries with employment decreases in November were transportation and warehousing, educational services, and agriculture. However, employment gained ground, in healthcare and social assistance, and in professional, scientific and technical services.
South of the border, the picture wasn’t bright either as 533,000 jobs were lost last month, the biggest decrease in 34 years. The unemployment rate there rose to a 15-year high of 6.7% from 6.5% in October.
November’s drop in payroll employment followed declines of 403,000 in September and 320,000 in October, as revised. This is the largest three-month decline in percentage terms since 1980.
“The news is getting worse. For the 11th month in a row, U.S. employment shrank, and in November, shrank it did,” says a note from BMO Capital Markets. “Only the government is hiring.”
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