Canada’s labor market came back to life after authorities began lifting lockdowns in February. A Statistics Canada report showed amazing results in the economy for the month of February. The results signal Canada’s economic resilience after the second wave and a two-month lockdown (December-January). The Business Suite had previously written about how Canada’s economy persisted through 2020 and had a positive outlook for the beginning of 2021.
According to the Statistics Canada report, the economy added 259,000 jobs in February. This is the first month of jobs since November. With this great news, the unemployment rate fell to 8.4%, the lowest since the beginning of the pandemic, from 9.4% in January.
The numbers show how well Canada’s economy handled closures in December and January, fueling expectations for a strong rebound in 2021. The report displays stronger than expected quarterly output data which shows that Canada avoided the economic stall economists expected over the winter.
Veronica Clark, an economist at Citigroup Global Markets, called the results ”amazing”. The numbers were bigger than what she expected. She added that “As long as there are no further hiccups there [in vaccinations], it means more re-openings and a further return to normal,” in a BNN Bloomberg television interview.
However, there are concerns about an uneven recovery with most job losses since last year concentrated in three industries: accommodation and food services, culture and recreation, and other services including personal care.
There was little change in the Canadian dollar, valued at C$ 1.2519 per U.S. dollar as of 9:55 AM in Toronto. Yields on the Canadian government’s five-year bonds were up 0.5 percentage points to 0.98%.
The Results Summarized:
Industries that recovered to pre-pandemic levels included educational and professional services, scientific and technical services because people in these industries could work remotely.
The positive sign in the report was that the number of long-term unemployed – people who have been out of work or temporarily laid off for 27 weeks or more – dropped by 49,000 jobs.
The labor utilization rate – a measure that includes not only those who are unemployed but also those working fewer hours because of COVID19 – fell to the lowest level since the beginning of the pandemic.
The accommodation and food services posted gains of 65,000, Statistics Canada reported. And retail trade employment rose by 122,000.
February’s employment gains were concentrated in lower-waged work – the sectors that have been hit the hardest by the pandemic. Youth Employment rose by 100,000.
Part-time employment increased by 171,000 while Full-time employment rose by 88,000.
Canada is still 599,000 below pre-pandemic levels. There are 406,000 people working less than half of their hours because of the pandemic.
References:
1) Government of Canada, S. (2021, March 12). Labour force survey, February 2021. Retrieved March 12, 2021, from https://www150.statcan.gc.ca/n1/daily-quotidien/210312/dq210312a-eng.htm
2) Hagan, S. (2021, March 12). Bloomberg.com. Retrieved March 12, 2021, from https://www.bloomberg.com/news/articles/2021-03-12/canada-s-economy-adds-259-000-jobs-blowing-past-expectations-km6czegi?srnd=premium-canada
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