MNI DATA IMPACT: Canada July Jobs +419K, Unemployment 10.9%

Canada's labor market improved for a third month in July as the Covid-19 shutdown eased, with 419,000 new jobs and unemployment falling to 10.9%, Statistics Canada said Friday.

The monthly gain means 1.7 million jobs have returned since the drop of 3 million through March and April. The MNI median was for 11% unemployment and 500,000 jobs.

Unemployment has also moved further away from May's record 13.7% and is below a pre-pandemic record of 13.1% set in 1982. Joblessness is still far above the 5.6% mark set in February before Covid-19 struck.

There are other signs that normal work conditions are returning, with the number of people working less than half their regular hours dropping 412,000 to 972,000 in July. There was a similar downward trend in the number of people who wanted a job but weren't looking because of the shutdown, StatsCan said.

Retailing, an industry hit hard by social distancing rules, saw employment return to 93% of pre-pandemic levels, while accommodation and food service employment lagged at 75%.

The job market still faces massive hurdles, with many small firms saying teetering on the edge of bankruptcy, most large gatherings still banned and many Canadians required to wear masks to enter any store or office. The government is also seeking to transition millions of people in the next few months from relief checks to a new unemployment insurance system aimed at gig workers who fell through the cracks.

Average hours worked -- a potential benchmark of GDP-- was 35.9 in July, close to the 36 hours recorded a year earlier. The labor force participation rate rose to 64.3%. It was 65.5% before the pandemic.