the rennie brief: labour market - may 8, 2020

THE LABOUR MARKET the rennie brief

WHAT YOU NEED TO KNOW: COVID-19 & THE IMPACT ON CANADIAN JOBS • With the release of April’s employment data, a clearer picture is being painted about the extent of our current economic shutdown: since February, Canada has shed 3.0 million jobs, pushing the national unemployment rate up to 13% • British Columbia has lost almost 400,000 jobs in the past two months, with the provincial unemployment rate rising from 5.0% to 11.5% • Metro Vancouver lost more than 256,000 jobs and saw its unemployment rate rise to 10.8% •

8 MAY 2020 A disproportionate share of these job losses have been realized in part-time work, in the service sectors (such as accommodation & food services, retailing), and among younger workers The job losses seen in March accelerated in April, with part-time positions, the service sector, and younger workers continuing to shoulder most of the declines.

LARGEST NUMBER OF JOB LOSSES ON RECORD In the wake of social-distancing policies implemented to limit the spread of COVID-19, Canada’s employment continued to fall in April. After shedding 1.01 million jobs in March, employment fell by a another 1.99 million jobs in April—the largest one-month decline on record. Cumulatively, Canada’s job loses since March now total 3.0 million, or 16% of the pre- downturn number. Canada’s unemployment rate now sits at 13.0%, up from 5.6% in February. The pace of job losses in BC mirrored that of Canada (a 16% decline) , with provincial employment falling by 397,000 jobs. British Columbia’s unemployment rate now sits at 11.5%, up from 5.0% in February. This is the province’s highest level of unemployment in 30 years. Metro Vancouver has shed 256,000 jobs since February, a 17% decline. This compares to a 15% drop in employment in the Greater Toronto Area and an 18% decline in jobs in greater Montreal. The unemployment rate in Metro Vancouver has risen to 10.8%, slightly below the provincial average. That being said, with the Metro Vancouver’s economy focused more heavily towards the service sector, the region has shouldered a disproportionate share of provincial losses (with 58% of BCs jobs, it saw 65% of While almost 70% of BC’s jobs losses in March were in part- time work, this trend shifted in the April data with full-time employment accounting for 70% of April’s losses. In looking at the last two months, 57% of job losses in BC have been in full-time work, with part-time accounting for the other 43%. Despite representing fewer than half of the recent job loss, part-time positions continue to bear the brunt of current circumstances as part-time accounts for less than a quarter of jobs in BC. provincial job losses) due to COVID-19. FULL-TIME JOB LOSSES GROW IN APRIL

ACCOMMODATION & FOOD SERVICES HIT THE HARDEST Along with a shift in job losses toward full-time positions in April, the goods-producing sector also saw its share of provincial job losses increase. After accounting for only 1% of March’s job decline, the goods-producing sectors accounted for 15% of losses in April (with the service sector consequently representing 85% of losses in April versus 99% in March). With service-based jobs accounting for 81% of all jobs in BC, the service sector has still shouldered the downturn to a disproportionate extent, accounting for 90% of provincial job losses in the past two months. Within this group, hotels and restaurants have been the hardest hit, accounting for 28% of job losses (while representing only 8% of total jobs). YOUNG WORKERS DISPROPORTIONATELY LOSING THEIR JOBS Given the losses playing out in the service sector and in part- time work, it is not surprising that young people have also been disproportionately impacted, accounting for the bulk of BC’s employment declines since February. In particular, the province’s under-30 job holders have accounted for 45% of total job losses while typically representing under one quarter of total employment in the province. Since February almost 174,000 people under the age of 30 have lost their jobs. WHAT IT MEANS The latest jobs data are dramatic, but not unexpected when considering both the narrative that began to emerge in last month’s employment data. Next month we hope to see the positive impacts of various government support programs such as the Canada Emergency Wage Subsidy and Canada Emergency Benefit Response programs on the jobs data. The May data will provide an indication of whether we have indeed reached the so-called “bottom”, or if additional economic adjustments will be necessary.

For further information please contact Ryan Berlin (rberlin@rennie.com) or Andrew Ramlo (aramlo@rennie.com). The information set out herein (the “Information”) is intended for informational purposes only. RAR & RMS has not verified the information and does not represent, warrant or guarantee the accuracy, correctness and completeness of the information. RAR & RMS does not assume any responsibility or liability of any kind in connection with the information and the recipient’s reliance upon the information. The recipient of the information should take steps as the recipient may deem necessary to verify the information prior to placing any reliance upon the information. The information may change any time without notice or obligation to the recipient from RAR & RMS.

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