Quick Take

Job recovery slows as pandemic hits employment in Western Canada

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The Conference Board of Canada economist Liam Daly offers the following insights on November’s Labour Force Survey (LFS):

This month’s labour market data shows that the jobs recovery continues to lose steam. While the overall number of employed Canadians grew in November, growth this month is the weakest since the beginning of the recovery in May.

The pandemic continues to dictate the labour market performance which varies by province and industry. Rising COVID-19 cases in the prairies have led to a decline in employment this month. As the year comes to an end, industries that can adapt to social distancing rules and remote working will continue to lead employment growth. However, for those placed under restrictions, particularly within hospitality, there is unlikely to be major progress until a vaccine becomes widely available.

  • Despite the labour market adding 62,100 jobs in the month of November, the increase is smaller than the previous months and is another indicator the economic recovery is slowing.
  • Rising cases of COVID-19 into early December means employment may decline in the next survey.
  • While the unemployment rate fell, it coincided with a fall in the labour force. The labour force’s decline is likely due to discouraged workers who are struggling to find jobs in industries that are heavily impacted by the pandemic.
  • Nevertheless, the national unemployment rate continues to creep downwards, falling by 0.4 points to 8.5 per cent over November, which is of course, welcome news.
  • Unsurprisingly the jobs recovery is in different stages across the country, depending largely on the progression of the virus in each region.
  • The Atlantic provinces each enjoyed employment growth in the month of November. Employment was strong in Nova Scotia (+10,000), New Brunswick (+4,200) and Newfoundland and Labrador (+2,300). In Newfoundland and Labrador, employment has now recovered to pre-pandemic levels.
  • After employment declined in October, Quebec added 15,700 jobs. Progress continues elsewhere with employment numbers ticking up in Ontario (+36,600) and British Columbia (+23,900)
  • However, there were declines in all three of the Prairie provinces, with strict measures and rising cases leading Manitoba’s employment to fall by 18,100. Losses were also observed in Saskatchewan (–2,800) and Alberta (–10,800).
  • Apart from the utilities sector, all other goods-producing industries, including construction and manufacturing enjoyed employment growth this month.
  • Among service-producing industries the picture is more mixed. After another month of job losses, both accommodation and food services and information, culture and recreation industries will continue to struggle until a vaccine is widely available.
  • However, impressive employment growth in the wholesale and retail trade and transportation and warehousing may reflect an uptick in retail as we approach the end of the year. There is some upside for the retail industry as savings rates have increased substantially since the beginning of the pandemic, and households may decide to spend extra this holiday season.
  • Employment in finance, insurance, real estate, rental and leasing services now exceeds pre-pandemic levels as do the number of people working in professional, scientific and technical services.

COVID-19: Get all the insights

Liam Daly

Liam Daly

Economist

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