Riddled by Omicron’s rapid spread, the Canadian economy lost 200,000 jobs in January amid stricter public health rules put in place to slow the variant of COVID-19, but signs point to a temporary wound rather than a drawn-out recovery.
The decrease marked the largest drop since January 2021, when the economy shed 207,800 jobs, Statistics Canada said Friday.
The job losses also pushed the unemployment rate to 6.5 per cent last month compared with 6.0 per cent in December, jacked up “entirely” by those temporarily laid off or scheduled to start a job soon — the number of Canadians looking for work hardly budged — the agency added.
As Omicron propagated across the country, governments reimposed capacity limits and closures on workplaces such as restaurants, retail outlets, gyms and theatres. The vast majority of job cuts were in Ontario and Quebec, where some of the the strictest measures of any province came down.
Food services and hotels were among the hardest hit, suffering their biggest monthly drop since the first wave. The plunge, which accounted for 57 per cent of the total decline, impacted young people and women the most, Statistics Canada said.
Culture and recreation — performing arts, cinemas and sports venues — made up nearly another quarter of the decrease, with some 48,000 job losses erasing gains made since August, almost entirely in Ontario. Retail employment also dipped significantly.
“It’s obviously got Omicron written all over it,” said Desjardins chief economist Jimmy Jean.
A record share of employees also missed work due to illness in January, with one in 10 away from their post. The number of employees who worked less than half their usual hours climbed by 620,000 or two-thirds, the largest increase since March 2020.
“That’s going to be reflected in the January GDP numbers,” Jean added.
But the absence stats may be cause for optimism, economists said.
“Even though the rise in unemployment was steeper than the consensus forecast, there was also evidence that firms tried to keep staff on the payroll during the Omicron wave due to expectations that the lockdown measures would be short-lived, and also due to difficulties recruiting staff in prior reopening phases,” said CIBC senior economist Andrew Grantham.
Most industries saw employment figures increase last month, with construction and natural resources fuelling 23,000 more jobs in the goods-producing sector alone.
Royce Mendes, managing director of economics at Desjardins, said that with Omicron cases likely past their peak and the tightest pandemic measures lifted, “that’s the beginnings of a recipe for another swift post-COVID-wave rebound” despite the January “carnage.”
Those ingredients also mean central bankers are “still on track” to hike rates in March as they seek to head off further inflation, he added.
The Bank of Canada kept its key interest rate target on hold last month at 0.25 per cent, but signalled it was preparing to begin raising its key rate in an effort to bring inflation under control and back to its target of two per cent.
The annual inflation rate rose to 4.8 per cent in December, its hottest pace since September 1991, and Bank of Canada governor Tiff Macklem has said the rate could stay “uncomfortably high” around five per cent over the first half of 2022.
The central bank’s next scheduled interest rate decision is set for March 2.
Recent history may prove a guide for job numbers in the coming months.
The wave of job losses when COVID-19 cases surged in January 2021 was followed by a bigger rebound of 272,500 in February last year. The economy lost 198,800 jobs last April — followed by a slight decline in May — but bounced back with 214,600 gains in June.
“The Canadian labour market showed impressive ability to rebound after previous waves last year, and some of the prevailing conditions that helped the recovery, like elevated employer hiring appetite, remain,” Brendon Bernard, a senior economist at job-posting site Indeed, said in an email.
Total hours worked in the economy fell back below their pre-pandemic level last month, plunging by 2.2 per cent — the largest drop since April.
Average hourly wages grew a “tepid” 2.4 per cent year over year, Mendes noted, despite a worker shortage across sectors ranging from information technology to trucking.
More than 40 per cent of employees worked mostly from home in January, which is above the one in four who’ve done so in the last few months, Statistics Canada said.
The total number of unemployed people jumped by 106,000, or 8.6 per cent month over month, to 1.34 million in January.
- Unemployment rate: 6.5 per cent (6.0)
- Employment rate: 60.8 per cent (61.5)
- Participation rate: 65.0 per cent (65.4)
- Number unemployed: 1,341,800 (1,236,100)
- Number working: 19,176,100 (19,376,200)
- Youth (15-24 years) unemployment rate: 13.6 per cent (11.1)
- Men (25 plus) unemployment rate: 5.2 per cent (5.1)
- Women (25 plus) unemployment rate: 5.6 per cent (5.2)
Here are the jobless rates last month by province (numbers from the previous month in brackets):
- Newfoundland and Labrador 12.8 per cent (11.9)
- Prince Edward Island 9.6 per cent (7.7)
- Nova Scotia 7.0 per cent (8.1)
- New Brunswick 8.5 per cent (8.2)
- Quebec 5.4 per cent (4.7)
- Ontario 7.3 per cent (6.1)
- Manitoba 5.1 per cent (5.3)
- Saskatchewan 5.5 per cent (5.5)
- Alberta 7.2 per cent (7.5)
- British Columbia 5.1 per cent (5.4)
Statistics Canada also released seasonally adjusted, three-month moving average unemployment rates for major cities. It cautions, however, that the figures may fluctuate widely because they are based on small statistical samples. Here are the jobless rates last month by city (numbers from the previous month in brackets):
- St. John’s, N.L. 7.2 per cent (7.3)
- Halifax 5.9 per cent (6.2)
- Moncton, N.B. 6.4 per cent (6.5)
- Saint John, N.B. 7.7 per cent (8.2)
- Saguenay, Que. 3.9 per cent (3.6)
- Quebec City 3.0 per cent (2.6)
- Sherbrooke, Que. 2.8 per cent (3.3)
- Trois-Rivieres, Que. 5.1 per cent (5.0)
- Montreal 5.2 per cent (5.4)
- Gatineau, Que. 5.0 per cent (4.4)
- Ottawa 4.7 per cent (4.4)
- Kingston, Ont. 5.9 per cent (6.4)
- Peterborough, Ont. 8.7 per cent (9.7)
- Oshawa, Ont. 6.6 per cent (6.8)
- Toronto 7.7 per cent (7.4)
- Hamilton, Ont. 5.5 per cent (5.8)
- St. Catharines-Niagara, Ont. 7.8 per cent (7.9)
- Kitchener-Cambridge-Waterloo, Ont. 5.2 per cent (5.5)
- Brantford, Ont. 6.5 per cent (7.6)
- Guelph, Ont. 4.1 per cent (4.0)
- London, Ont. 6.3 per cent (6.1)
- Windsor, Ont. 8.2 per cent (7.0)
- Barrie, Ont. 6.6 per cent (5.4)
- Greater Sudbury, Ont. 5.3 per cent (5.7)
- Thunder Bay, Ont. 6.6 per cent (6.7)
- Winnipeg 5.0 per cent (5.3)
- Regina 5.3 per cent (5.7)
- Saskatoon 5.2 per cent (5.6)
- Calgary 8.5 per cent (8.4)
- Edmonton 6.6 per cent (6.5)
- Kelowna, B.C. 7.2 per cent (5.7)
- Abbotsford-Mission, B.C. 5.4 per cent (7.4)
- Vancouver 5.7 per cent (5.8)
- Victoria 3.9 per cent (4.3)
This report by The Canadian Press was first published Feb. 4, 2022
Stock market news live updates: Stock turn lower following last week's rebound – Yahoo Canada
U.S. stocks closed a choppy session lower Monday, weighed down by losses in technology shares, after the major indexes failed to sustain momentum from last week’s rally.
The S&P 500 fell 0.3%, and Dow Jones Industrial Average dipped 60 points, or 0.2% after each benchmark wavered between the red and the green throughout the trading day. The Nasdaq Composite declined 0.9%.
The moves follow a sharp rebound Friday that saw the S&P 500 surge 3% during the session and over 6% for the week, its second-best week this year and its first weekly rise since late May. Still, the benchmark index is on pace for its worst opening six months since 1970.
During the previous session, the Dow rose more than 800 points, or 2.7%, while the Nasdaq increased by more than 3.3%, leading to weekly gains for the indexes of more than 5% and 7%, respectively.
Some Wall Street strategists are hopeful that markets may have found a bottom.
“As bad as [this year] has been for investors, the good news is previous years that were down at least 15% at the midway point to the year saw the final six months higher every single time, with an average return of nearly 24%,” LPL Financial chief market strategist Ryan Detrick said in a note last week.
J.P. Morgan strategist Marko Kolanovic also predicted that U.S. equities may climb as much as 7% this week as investors rebalance portfolios amid the end of the month, second quarter, and first half of the year.
While sentiment on Wall Street appears optimistic, investors are in for a bevy of key economic reports and earnings that may sway markets this week and put hopes of a comeback to the test.
Quarterly results from Nike (NKE) and Micron (MU) will be closely watched for signs of rising inventories and slowing orders like Target and some other retailers have warned about recently, which may renew worries of an economic slowdown among Corporate America.
Traders also face a fairly loaded economic calendar this week, with the latest read on core PCE inflation – the Federal Reserve’s preferred measure of consumer prices, the Conference Board’s consumer sentiment survey, and manufacturing and housing reports due out through Friday.
On the move
Robinhood Markets (HOOD)‘s stock surged 14% to close at $9.12 per share following a report from Bloomberg that cryptocurrency exchange FTX is considering a deal to acquire digital trading platform. Earlier in the day, Robinhood was in the spotlight after Goldman Sachs upgraded the brokerage to Neutral, about two months after the bank downgraded shares to Sell.
Coinbase (COIN) shares plunged nearly 10.8% to $55.96 after analysts at Goldman Sachs on Monday downgraded the cryptocurrency exchange to Sell from Neutral and slashed their price target on the stock to $45 from $70. Goldman also noted that while Coinbase recently announced it would cut 18% of staff, these layoffs will not be enough to bring the company’s costs in line with lowered sales.
AMC Entertainment (AMC) rallied to cap trading up 13.6% despite a turbulent session for the broader markets. The stock rose amid increased mentions across forums such as Reddit’s WallStreetBets and Stocktwits. AMC was also added to the Russell 1000 Index after an annual rebalancing.
Alexandra Semenova is a reporter for Yahoo Finance. Follow her on Twitter @alexandraandnyc
Man uses Apple Airtags to find stolen Range Rover | CTV News – CTV News Toronto
An Ontario man whose car was stolen from his driveway in midtown Toronto twice in three months is revealing how he tracked and located his second vehicle.
“It’s pretty scary, but you can’t live your life in fear,” Lorne, whose surname CTV News Toronto has omitted due to safety concerns, said on Monday.
On April 1, his family moved to the Avenue Road and Lawrence Avenue area.
The following day, employees from an electronics company arrived at his house to install televisions. He placed the keys of his Range Rover Autobiography into a faraday box, which is designed to prevent criminals from copying a key fob and gaining access to a vehicle.
However, within minutes of the employees leaving his house, his car was stolen in broad daylight.
“The thieves were able to disable the tracker in my car, put there by the manufacturer,” Lorne said.
Meanwhile, his wallet, along with his kids phones, which were in the car, were thrown out of the vehicle before it was stolen, which Lorne said he believes was a preventive measure to avoid him from tracking the location of his car.
His Range Rover was never recovered.
Thirty days later, he got a new car of the same model, but this time, he placed three Apple AirTag tracking devices inside – one in the glovebox, another in his spare tire in the trunk and a third under his back seat.
While Lorne said he typically parks in his garage, last Wednesday night, he didn’t.
At 8:30 a.m. the next morning, he said his kids ran into his bedroom screaming, ”Daddy, daddy, your car is gone.”
Right away, he logged into his Find My app and located all three of his AirTags near Manville and Comsock roads in Scarborough, listed as a metal recycling plant.
After dropping his kids at school, he headed to that location and called the police. With no success reaching an officer, he drove to the 41 Division police station.
Toronto police spokesperson David Hopkinson confirmed to CTV News Toronto that a report of this nature was received by police on Thursday.
“I pressed my panic button and you heard it going off,” Lorne said. “The next day I was told they recovered nine cars.”
Due to an ongoing investigation, police could not comment further on the incident.
This time, however, Lorne said police recovered his vehicle and he anticipates it should be back in his possession soon.
While he said his AirTags worked in this case, he anticipates car thefts will only get increasingly sophisticated.
“It’s not foolproof,” he said.
Company buying Trump's social media app faces subpoenas – Yahoo Canada Finance
NEW YORK (AP) — The company planning to buy Donald Trump’s new social media business has disclosed a federal grand jury investigation that it says could impede or even prevent its acquisition of the Truth Social app.
Shares of Digital World Acquisition Corp. dropped almost 10% Monday as the company revealed that it has received subpoenas from a grand jury in New York.
The Justice Department subpoenas follow an ongoing probe by the Securities and Exchange Commission into whether Digital World broke rules by having substantial talks about buying Trump’s company starting early last year before Digital World sold stock to the public for the first time in September, just weeks before its announcement that it would be buying Trump’s company.
Trump’s social media venture launched in February as he seeks a new digital stage to rally his supporters and fight Big Tech limits on speech, a year after he was banned from Twitter, Facebook and YouTube.
The Trump Media & Technology Group — which operates the Truth Social app and was in the process of being acquired by Digital World — said in a statement that it will cooperate with “oversight that supports the SEC’s important mission of protecting retail investors.”
The new probe could make it more difficult for Trump to finance his social media company. The company last year got promises from dozens of investors to pump $1 billion into the company, but it can’t get the cash until the Digital World acquisition is completed.
Stock in Digital World rocketed to more than $100 in October after its deal to buy Trump’s company was announced. The stock closed at $25.16 Monday.
Digital World is a special-purpose acquisition company, or SPAC, part of an investing phenomenon that exploded in popularity over the past two years.
Such “blank-check” companies are empty corporate entities with no operations, only offering investors the promise they will buy a business in the future. As such they are allowed to sell stock to the public quickly without the usual regulatory disclosures and delays, but only if they haven’t already lined up possible acquisition targets.
Digital World said in a regulatory filing Monday that each member of its board of directors has been subpoenaed by the grand jury in the Southern District of New York. Both the grand jury and the SEC are also seeking a number of documents tied to the company and others including a sponsor, ARC Global Investments, and Miami-based venture capital firm Rocket One Capital.
Some of the sought documents involve “due diligence” regarding Trump Media and other potential acquisition targets, as well as communications with Digital World’s underwriter and financial adviser in its initial public offering, according to the SEC disclosure.
Digital World also Monday announced the resignation of one of its board members, Bruce Garelick, a chief strategy officer at Rocket One.
The Associated Press
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