Job losses top one million in March as coronavirus slams Canadian economy – The Globe and Mail

More than one million people in Canada lost their jobs in March and the unemployment rate climbed to 7.8 per cent, reflecting the first wave of layoffs resulting from the COVID-19 pandemic.

The March job losses easily surpassed a record one-month decline set in January of 2009 – when employment dropped by roughly 125,000 – according to Labour Force Survey data from Statistics Canada that dates back to 1976. March also saw the largest one-month increase of the country’s jobless rate, which had been 5.6 per cent in February.

Record-setting job losses were widely anticipated in Thursday’s report. Statscan surveyed households on labour conditions between March 15 and 21, which overlapped with many companies shutting their doors and laying off staff as COVID-19 started to upend the economy.

Among those employed between March 15 and 21, roughly 2.1 million people either didn’t work any hours or worked less than half their usual hours.

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“These increases in absences from work can be attributed to COVID-19 and bring the total number of Canadians who were affected by either job loss or reduced hours to 3.1 million,” Statscan said.

Prime Minister Justin Trudeau on Wednesday warned the jobs report would be ugly. “It’s going to be a hard day for the country,” he said.

Since Statscan’s survey week, layoffs have intensified as governments have implemented tighter restrictions on business operations and social interactions to curb the virus’s growth. Since March 16, more than 5 million Canadians have applied for emergency financial assistance with the federal government, a sign of unprecedented labour disruption.

As such, the April labour report (released early next month) is widely expected to show even worse job-loss figures.

Thursday’s report showed the employment rate declined to 58.5 per cent from February’s 61.8 per cent, while the labour participation rate – the percentage of people either working or looking for a job – declined to 63.5 per cent in March from 65.5 per cent.

Ontario experienced the largest job losses in raw numbers, with the number of employed people declining by about 403,000, followed by Quebec at 264,000 and British Columbia at 132,000.

As expected, the accommodation and food services sector was hit hard, with nearly 300,000 people losing their jobs, a decline of 24 per cent. The information, culture and recreation sector lost 13.3 per cent of its employment, while educational services dropped 9.1 per cent.

Employment among youth aged 15 to 24 decreased by nearly 400,000 or 15.4 per cent.

Among the roughly one million people who lost employment, there was a near even split of those who joined the ranks of the unemployed and those who dropped out of the labour force.

The distinction between people who are unemployed or not in the labour force is particularly important within the context of COVID-19.

According to the LFS, the unemployed includes those who are available for work and have looked for employment in the past four weeks, along with those on temporary layoff who expect to rejoin their employer. It also includes those who are set to start a job within four weeks.

Given those stipulations, many workers affected by COVID-19 are not officially considered unemployed. For instance, a jobless parent who’s suddenly handling home-school and daycare duties, and thus isn’t available to work, is not considered unemployed. Nor is the jobless person who’s stopped looking for work because their industry has stopped hiring.

Instead, they are considered to be not in the labour force.

The federal government recently unveiled a program that will subsidize wages for eligible companies by up to 75 per cent, to a maximum of $847 per week per employee. Some companies, such as Air Canada and WestJet Airlines, will use the program to bring back workers. However, the extent to which the wage-subsidy program dampens layoffs or encourages rehiring remains to be seen.

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