economy
01. economy While still elevated, unemployment rates across the country are receding from their peak-Covid levels, bringing us closer to re-achieving pre-pandemic labour market conditions.
THE TIGHTENING LABOUR MARKET VICE
Over the past year-and-a-half, the pandemic has manifested itself most directly in changes in labour market conditions, both here in British Columbia and throughout all of Canada (and beyond). At the beginning of 2020, the labour market seas were calm: in Metro Vancouver, the regional unemployment rate sat at 4.5%, employment was growing by 3% per year, and incomes were rising. Such as it is with unexpected events, Covid really threw us for a loop, leading us to an economic suppression that saw almost 20% of jobs disappear. Alongside this, the region’s unemployment rate spiked to 14.6%—easily the highest in our history, though slightly below the apex realized by each of Greater Toronto (15.5%) and Greater Montreal (15.1%).
Fast forward to the end of summer 2021, and Metro Vancouver’s unemployment rate has achieved a new pandemic-low of 7.3%. During more typical economic times, an unemployment rate this high would raise alarm bells. But of course, these times are still not typical. Interestingly, and as shown on the next page, the number of jobs in Metro Vancouver now exceeds the pre-pandemic high. So why the relatively high unemployment rate, when we have more jobs than we did at a time when the unemployment rate was 4.5%? Well, because our labour force has continued to grow (by 4%, as the labour participation rate now exceeds its pre-pandemic level).
We’re headed in the right direction, but we’re clearly still in the recovery phase of our economic journey.
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