Employment continues steep drop

As expected, Canada suffered another month of record-shattering job loss in April as containment measures to stem the spread of COVID-19 kept workers at home and shuttered workplaces temporarily, leading to a swath of layoffs across the country.

Adding to a loss of jobs by one million people in March, two million more Canadians became unemployed in April. At 16.18 million persons, employment was the lowest since September 2005. The average unemployment rate jumped from 7.8% to 13%, which was the second-highest unemployment rate on record.

Headline statistics tell only part of the story. The total number of hours worked in the economy fell at a faster rate than headline employment at 14.9%, as many employed individuals worked zero or reduced hours.

B.C. paralleled the national performance. Employment fell by 264,100 persons or 11% over the latest month, bringing the two-month loss to 396,500 persons since February. Full-time employment fell 10.1%, with part-time employment down 14.8% over the latest month. Similarly, actual hours worked in the economy tumbled, with levels down 20% on a year-over-year basis. Average unemployment rose from 7.2% to 11.5%

Nearly all sectors of the economy recorded lower levels of employment in April. The sharpest decline was in accommodations and food services, where employment fell by 75,700 persons or 47.7% over the month, and by 57% since April. This sector has been hardest hit from the combination of physical distancing requirements, which has shuttered dine-in services, and a near stoppage of tourism activity. Information/culture/recreation employment fell 17,400 or 17.2% in the latest month, with a 29% decline since February reflecting the tourism downturn and effective shutdown of large events. Other sectors with sharp declines from March included agriculture, construction and wholesale/retail trade.  We are likely at or near bottom for the employment downturn. Provinces are turning to the restart phase for their economies, including B.C., and increased reopening of affected sectors will turn into further employment gains, although it will be a long ramp up to pre-COVID-19 levels.

Home sales plunged in April as the COVID-19 pandemic pushed buying activity to the sidelines. Total sales in the Lower Mainland fell to 1,775 units in April, down more than 54% from March and nearly 44% from same-month 2019.•

Bryan Yu is deputy chief economist at Central 1 Credit Union.