A dismal jobs report from Canada was the result of a combination of bad management and an over-reliance on government data, economists say.
The national unemployment rate is 7.9 per cent, up from 6.9% in August.
Economists polled by Bloomberg expect the unemployment rate to climb to 6.7 per cent by year-end, and 6.4 per cent for 2018.
But they warned the unemployment numbers would be far worse than what was forecast by the Bank of Canada and other economic indicators.
“If you look at the headline numbers and what’s on the ground, it’s quite the opposite,” said Richard Kohn, chief economist for RBC Dominion Securities.
“There are quite a lot of people who have found a job, or are actively looking for a job.”
Canada’s economy shrank by 0.9 percentage points in the fourth quarter, which was worse than expected.
The unemployment rate has risen from 6 per cent in the third quarter to 7.1 per cent now.
The economy expanded 0.2 per cent last quarter, the strongest growth since late 2014.
The economy is expected to add a bit more than 1.5 million jobs in 2018.
Canada is a major trading partner of the U.S. and the euro area.
A separate economic report on Wednesday said the country’s gross domestic product expanded at an annualized rate of 0.7 percent in the three months ending in April.
The unemployment rate will rise to 7 per cent this year.