Canada's economy defied expectations in October, adding 9,500 jobs, but economists note it was thanks to a one-time hiring boost related to the federal election.
According to a Statistics Canada report released Friday, Canada's jobless rate edged up from September's 6.1 per cent to 6.2 per cent in October.
The jump was driven by an increase in the number of people looking for work, said researchers.
While there was an overall employment gain of 9,500 workers, it was largely the result of the temporary hire of 40,000 public-sector administrative workers -- mostly needed for the fall federal election.
Private-sector jobs actually declined in October by 20,000.
"Things are going to get worse," said Dale Orr, managing director of the Global Insight forecasting firm. "We see no employment growth next year and the unemployment rate going up to seven per cent".
Still, Bank of Montreal economist Douglas Porter said October's report was "surprisingly sturdy."
"Landing deep in the heart of October's financial market turmoil, the stability in Canada's latest jobs survey is impressive, even if the numbers were bolstered by election-related hiring," Porter said in a research note.
"After all, this modest gain follows a record rise in the prior month. If there was any lingering doubt that Canada's economy is faring better than the U.S. -- so far -- this two-month performance should quash it."
Toronto-Dominion Bank economist Charmaine Buskas was less optimistic, saying the temporary election jobs will only delay the inevitable poor figures to come.
"We still expect that the Canadian labour market will be retrenching going forward in response to cooling U.S. demand for Canadian goods and slowing in domestic economic conditions," Buskas said in a research note.
She did say the addition of 47,500 full-time jobs "bodes well for income growth."
Private sector employment, which is viewed as a closer measure of the health of the economy, did fall by more than 20,000 jobs.
"Good-producing jobs fell 27,000 in the month, led by construction and manufacturing, which each lost 9,000 jobs. Within the service-producing component, the weakness was led by a 27,000 drop in employment in accommodation and services," Royal Bank of Canada economist Paul Ferley said in a research note.
He added that the weakness in these sectors "is more consistent with the pressures confronting the Canadian economy, including the high costs of capital that has already likely sent the U.S. economy into a recession."
Friday's report also showed youth employment in October fell by 34,000. However, employment among men aged 25-54 rose by 20,000 while women aged 55 and older saw gains of 25,000.
Provincially, employment increased in Alberta by 15,000 jobs. The province has the lowest unemployment rate in all of Canada at 3.7 per cent.
There was little employment change in other provinces.
Since the beginning of 2008, employment in Canada has increase 1.2 per cent, or 203,000 positions, with gains in both full and part time.
During the same period in 2007, employment rose by 2 per cent, or 338,000 jobs.
