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During February, 30,300 positions were created, handily beating the consensus estimate of 11,000 jobs added, Statistics Canada said Friday.
Darryl James/The Globe and Mail
The Canadian economy added more than 30,000 jobs during February as the labour market continues a run of strength that could be threatened by the coronavirus outbreak.
During the month, 30,300 positions were created, handily beating the consensus estimate of 11,000 jobs added, Statistics Canada said Friday in its Labour Force Survey. The unemployment rate ticked higher, to 5.6 per cent, but remains near historic lows.
The entirety of February’s gain was in full-time work from private-sector employers. Wholesale and retail trade (22,600 jobs created) and manufacturing (16,000) were standout sectors, while Quebec added the largest number of jobs (20,000) by province and saw its jobless rate tumble to 4.5 per cent, the lowest since comparable data became available in 1976.
Strong hiring and wage growth “are encouraging, but the real test will come in the next few months as the effects of the coronavirus outbreak are felt,” said Stephen Brown, senior Canada economist at Capital Economics, in a research note.
Statscan’s survey was conducted between Feb. 9 and 15. Since then, COVID-19 has spread to more countries, and the number of confirmed cases in Canada has risen. Virus fears have roiled markets, disrupted business operations and forced central banks – including the Bank of Canada – to cut interest rates to support a vulnerable economy.
Bank of Canada Governor Stephen Poloz warned of labour disruptions on Thursday. In a speech, he said the economy’s resilience could be “seriously tested” by the COVID-19 outbreak.
“Consumer and business confidence could be set back for a longer period of time, causing economic growth to slow more persistently,” Mr. Poloz said. “This could include longer-term layoffs, for example. At this point, we simply do not know.”
Scores of companies have responded to COVID-19 by getting some or all of their employees to work from home. In February, there were 110 transcripts from public companies that mentioned remote work, according to financial data platform Sentieo. Prior to then, a typical month would see three conference calls mention such arrangements.
Canadian companies including SNC-Lavalin Inc., WSP Global Inc. and Stantec Inc. have all asked some employees to work from home, transcripts show.
But for many industries, remote work is not an option. Canada’s tourism sector, for instance, is set for a rude awakening this year as travellers stay home and conferences get cancelled. Chinese tourist spending in Canada could plunge by one-third this year, resulting in a $550-million hit to the economy, the Conference Board of Canada estimates.
Mr. Poloz also pointed to weaker commodity prices and their ability to transfer “international shocks to the Canadian economy.” Oil prices have tumbled this year due to weaker demand, and a prolonged slump could weigh on company investments and hiring plans.
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