Canada’s labor market lost 68,000 jobs in May as tighter public health regulations took place in different regions of the country to curb the third wave of the coronavirus pandemic. The unemployment rate was up to 8.2% from 8.1% in April, according to a Statistics Canada Labor Force Survey.
Out of the jobs lost, 54,000 were part-time and 13,800 were full-time. The decline in jobs in May was smaller compared to a month earlier. In April, the number of part-time jobs that were lost was 78,000 and 129,000 full-time jobs.
The restrictions implemented since April in the biggest two provinces in Canada, Ontario and Quebec, especially took a toll on manufacturing jobs. The number of people working in manufacturing dropped by 36,000, the first decline in the industry since April 2020.
And almost 16,000 job losses were reported in construction, driven mostly by Ontario’s stay-at-home order which was implemented on April 17th.
Saj Thanabalasingam, a senior economist at TD Economics, said the acceleration in the vaccine rollout may provide employers with added confidence and boost hiring plans. But the drop in this month’s participation rate is concerning. The labor market will be an area to watch in the coming months as Canada could face labor shortages given that demand for labor is recovering faster than supply, he added.
According to Jimmy Jean, vice president and chief economist for Desjardins Group, labor shortages down the road are the result of a mix of factors. He said that lots of people are uncomfortable about getting back in the labor market with some wondering if it’s safe. Others are weighing government benefits, as some programs can more than compensate those who make minimum wage.
The report said that the country will continue to transition out of the third wave of the pandemic in the coming months. Different parts of the country are easing restrictions as the vaccination campaign reaches its potential.
In British Columbia for example, many indoor and outdoor activities resumed on May 25. While Quebec ended its nightly curfew and allowed restaurants to reopen outdoor patios, Ontario’s stay-at-home order expired June 2nd and the province still awaits the first phase of the reopening plan to begin on June 14th.
References:
1) CBC News. (2021, June 4). Economy lost 68,000 jobs in May, unemployment rate rose slightly to 8.2% | CBC News. CBCnews. https://www.cbc.ca/news/business/unemployment-rate-may-1.6053091
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