Canada’s economy added 289,600 jobs in May, most of them full-time, as parts of the economy reopened during the COVID-19 pandemic.
Some economists had predicted a loss of around half a million more jobs in May — in addition to the three million or so jobs lost in Canada through March and April — and an unemployment rate of 15%.
But the latest data from Statistics Canada shows an unemployment rate of 13.7%, up from 13% last month. The increase in Canada’s unemployment rate came as more people started looking for work, rather than additional layoffs.
Statistics Canada also says the number of people who worked less than half their usual hours fell by 292,000 in May.
The reopening of Canada’s economy comes as provinces and municipalities can say with confidence that they are “past the peak” of contagion having “flattened the curve”, with more manageable case loads and new practices in place to ensure that businesses that are allowed to reopen in some way may do so safely. This has allowed businesses to reopen in a staged manner, a practice that should continue through the summer months, all going according to plan.
So, is this month’s Jobs Report good or bad news? Trevin Stratton, the Canadian Chamber of Commerce’s Chief Economist and VP of Policy, says we shouldn’t read too much into the figures just yet.
“It is indeed a strange time when we react favorably to slowing job losses that by any standard measure would be catastrophic. Today’s figures [289,600 jobs gained, but 13.7% unemployment] are both terrible and positive at the same time,” he said in a release.
Meanwhile, Royce Mendes, senior economist at Canadian Imperial Bank of Commerce (CIBC), noted, “The surprisingly positive readings on employment paint a more optimistic picture of the early part of the recovery, but there’s still a long road back.”
The long road back: where are the new jobs created in Canada?
Quebec accounted for nearly 80 per cent of the jobs created. Employment in Quebec increased by 231,000 (+6.5%) and the proportion of workers who worked less than half their usual work hours for COVID-19-related reasons declined by 6.6 percentage points to 19.3%.
This follows a devastating early spring during which the unemployment rate in Quebec shot up to 17%, a rate that has now snapped back in line with the national average at 13.7%. The Quebec provincial government eased restrictions on much business before Statistics Canada gathered data mid-May, notably in construction from mid-April, and in retail trade and manufacturing outside Montreal from May 4. Despite the slower reopening of the economy in the Montreal census metropolitan area, home to nearly half the population of Quebec, employment increased by 97,000 (+5.3%) in the Montreal CMA in May.
The proportion of workers working from a location other than home increased from 60% in April to 65% in May. The largest employment increases in Quebec were in construction (+58,000), manufacturing (+56,000) and wholesale and retail trade (+54,000), three industries with a relatively high proportion of jobs that are difficult to do from home. The fact that Quebec has a higher share of jobs that are difficult to perform off-site goes a long way to explaining why its rise in unemployment earlier this year was so extreme, and why its recovery now is so impressive.
Montreal’s unemployment rate (15.2%) is now in line with Canada’s two other largest cities, Toronto (15.4%) and Vancouver (14.1%), with the latter two having seen a rise in unemployment in May.
Ontario, home to Toronto, was the only province to see a loss in net job creation in May (-65,000). Most restrictions on economic activity remained in place in Ontario when the jobs data was gathered, as Ontario’s government has taken a more cautious approach to reopening the economy. We may expect job creation in Ontario to grow through the summer months as its phased reopening unfolds.
British Columbia added 43,000 jobs in May and the unemployment rate rose 1.9 percentage points to 13.4% as more people looked for work. Almost all of the employment increase in B.C. were in the services-producing sector (+41,000), led by accommodation and food services (+12,000), educational services (+12,000), and wholesale and retail trade (+12,000). Like Ontario, B.C. should show stronger employment figures over the coming months.
Meanwhile, unemployment in Alberta now stands at 15.5%, while the Prairie provinces of Saskatchewan (12.5%) and Manitoba (11.2%) are holding steady as their phased reopenings take shape. Out East, Newfoundland (16.3%) now has the highest unemployment rate in Canada, despite 10,000 new jobs in May, while Nova Scotia (13.6%), PEI (13.9%), and New Brunswick (12.8%) are all within a percentage point of the national average.
Is Canada over the worst of the pandemic?
In purely economic terms, the Bank of Canada’s latest outlook is that Canada avoided the worst-case scenario and the impact on the global economy has peaked.
“This impact appears to have peaked, although uncertainty about how the recovery will unfold remains high,” the Ottawa-based central bank said in a statement. “Decisive and targeted fiscal actions, combined with lower interest rates, are buffering the impact of the shutdown on disposable income and helping to lay the foundation for economic recovery.”
Will more jobs be created in Canada this summer?
The latest Jobs Report for May shows a snapshot of Canada’s economy in the earlier stages of the reopening. As more businesses and services reopen and if the phased reopening of provincial economies can continue as planned, it may be expected that more people who were laid off in March and April can return to work.
Moreover, some jobs — such as infrastructure projects, among others — will require new workers entirely.
“The outlook for infrastructure projects in Canada remains strong, particularly in water, transportation, and power,” says Ruairi Spillane, Managing Director of Outpost Recruitment, an agency specialising in engineering and construction.
“With increased municipal and federal spending assigned to boost Canada’s aging infrastructure network and these works classified as essential during the pandemic, there will be a strong pipeline of work. Employment prospects remain exceptionally bright across Canada’s infrastructure sector.”
Outpost Recruitment is actively looking for candidates for projects across Canada, and you can see the latest job postings here.
How to get a job in Canada
We at Moving2Canada have been flooded with inquiries from people who recently moved to Canada, or who have been laid off, or whose plans to move to Canada in the near future have been affected by the pandemic.
Despite the public health crisis and economic downturn, and the anxiety and confusion that may result, now is a good time to make sure you are well positioned to take advantage when Canada’s economy recovers.
- Get your resume in good shape. This crucial step is often left down the list of job seekers’ priorities, despite being arguably the most important step of all. Read our Canada resume guide to get going.
- Start looking at open opportunities. Some companies are still hiring. Don’t believe us? Head over to our Jobs Board, populated daily with new positions across Canada.
- Build your network. You can assemble a team to help you in your job search. With ongoing physical distancing and travel restrictions, technology is your friend here. Read our networking guide, written by award-winning entrepreneur Ruairi Spillane, for expert advice.
New and improved Jobs Board
We have worked hard over recent weeks to ramp up the number and range of job postings on our Jobs Board. Despite the severe economic downturn and impending recession, we’re adding new postings daily. Even if you don’t apply right away, visiting the Jobs Board regularly will provide a feel for job opportunities in Canada.
Want to dig deeper into the Canada Jobs Report data? Try these interactive tools, courtesy of StatsCan.