Canada's job market experienced a rebound in February, as restrictions were eased to varying degrees, adding 259,000 jobs.
According to Statistics Canada, gains were mostly in part-time work (171,000) but there were full-time gains as well (88,000).
The unemployment rate fell 1.2 percentage points to 8.2%, to the lowest rate since March 2020.
The February gain is well ahead of the 75,000 jobs economists predicted and follows 266,000 jobs lost over the previous two months.
As restrictions started to ease we saw a rebound in Ontario (+100,000) and Quebec (+113,000). Employment also increased in British Columbia, Alberta and Manitoba, while it fell in Newfoundland and Labrador.
After being hit hardest in previous months retail trade, accommodation and food services bounced back with a gain of 187,000 jobs as more non-essential businesses were allowed to reopen.
"While the strong report appears to increase the chance of the Bank of Canada taking a more hawkish stance at its next policy meeting in April, we think it will continue to err on the side of caution and hold off from adjusting its QE program until July, given 600,000 people remain out of work compared to a year ago," said Stephen Brown, senior Canada economist at Capital Economics.
An uncertain job market ahead
Jim Mitchell, president of employment services firm LHH says there are positives, including his company's survey that found over 70 per cent of companies are continuing to hire. But he says there are reasons to be cautious going forward.
“With the pandemic extending into the second quarter, it’s no surprise that companies remain cautiously optimistic about employment decisions. Some industries, like travel and hospitality, were obviously forced to react quickly. Companies in other key sectors reacted less uniformly," he said.
“Uncertainty will remain in the short-term, as vaccines get rolled out by age and concerns about variants and additional waves loom ominously. However, I’m optimistic that we’ll see a positive inflection point by mid-year. This can already be seen with limited office planning.”
A stronger Canadian dollar
The loonie (CADUSD=X) touched 80 cents compared to the U.S dollar today, bolstered by the stronger than expected jobs report.
"The Canadian dollar scrambled higher against its US counterpart in the aftermath of the data, and was outperforming its major currency peers against the broadly stronger US unit," said Don Curren, market strategist and content editor at Cambridge Global Payments.
"It was about 0.2% higher against the greenback on a sessional basis as we went to pixels, despite the roughly 0.5% gain by the US dollar on a trade-weighted basis."
Jessy Bains is a senior reporter at Yahoo Finance Canada. Follow him on Twitter @jessysbains.
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