March 2020 Labour Market Update

The latest Statistics Canada local labour market report customized for the Brantford CMA for last month is now available.

March Unemployment Rate: Brantford 5.9% [+] Ontario 7.6% [+] Canada 7.8% [+]

Be sure to review the participation rate and the employment rate (reported as percentages), as well as the labour force, the employed, and the unemployed values (reported as absolute numbers). These give a better picture of changes in the market.

Labour Market Reports

The report includes annual rates for the last 10 years, comparing Brantford to surrounding CMAs as well as the provincial and national levels.

Note from Statistics Canada on data collection during the pandemic

"The March Labour Force Survey (LFS) results reflect labour market conditions during the week of March 15 to 21. By then, a sequence of unprecedented government interventions related to COVID-19—including the closure of non-essential businesses, travel restrictions, and public health measures directing Canadians to limit public interactions—had been put in place. These interventions resulted in a dramatic slowdown in economic activity and a sudden shock to the Canadian labour market. The slowdown continued beyond the LFS reference week and is likely to be more fully reflected in April LFS data...

Statistics Canada is closely monitoring the impacts of COVID-19 (also known as the novel coronavirus) on the Canadian labour market.

The March release of the LFS is the first at Statistics Canada in which the impact of the COVID-19 outbreak is clearly visible. The data in this release correspond to the reference period of March 15 to 21.

During the reference period, a number of provinces and territories, as well as municipalities across the country, declared a state of emergency. This had a clear and immediate impact on the Canadian labour market. Businesses and institutions of all sizes and in a variety of industrial sectors announced layoffs, and many individuals still employed experienced changes in the way they work, including to their hours worked. In response, an unprecedented number of Canadians took advantage of existing and newly-announced support measures.

The LFS will measure the impact of COVID-19 on the Canadian labour force as it continues to evolve over the coming months. Statistics Canada is committed to the application of existing survey concepts, based on internationally-accepted best practices, as well as the development and reporting of innovative indicators and analysis appropriate to this unprecedented situation.

In March, to ensure the safety of both interviewers and respondents, all interviews were conducted over the phone or with an electronic questionnaire. Statistics Canada is deeply grateful for the cooperation of tens of thousands of Canadians who responded to the survey and to our dedicated interviewers who ensured that the data collected was of the highest possible quality.

Statistics Canada will continue to report the impacts of COVID-19 on the Canadian labour force as information becomes available."

Statistics Canada COVID-19 labour market commentary

The following details are taken from the Statistics Canada report entitled Labour Force Survey, March 2020.

Headlines

Employment fell by more than one million in March (-1,011,000 or -5.3%). The employment rate—or the proportion of people aged 15 and older who were employed—fell 3.3 percentage points to 58.5%, the lowest rate since April 1997.

Of those who were employed in March, the number who did not work any hours during the reference week (March 15 to 21) increased by 1.3 million, while the number who worked less than half of their usual hours increased by 800,000. 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.

The unemployment rate increased by 2.2 percentage points to 7.8%, the largest one-month increase since comparable data became available in 1976. Unemployment increased by 413,000 (+36.4%), largely due to temporary layoffs. In addition, the number of Canadians who had worked recently and wanted to work, but did not meet the official definition of unemployed, increased by 193,000.

Sharp increase in unemployment and more Canadians out of the labour market

The number of people who were unemployed increased by 413,000 (+36.4%) from February to March, the largest monthly change since comparable data became available in 1976. Almost all of the increase in unemployment was due to temporary layoffs, meaning that workers expected to return to their job within six months.

The unemployment rate increased 2.2 percentage points to 7.8% in March. This was the largest one-month increase on record, and brought the rate to a level last observed in October 2010.

The unemployment rate increased in all provinces except Newfoundland and Labrador and Prince Edward Island. The largest increases were in Quebec (+3.6 percentage points to 8.1%), British Columbia (+2.2 percentage points to 7.2%) and Ontario (+2.1 percentage points to 7.6%).

In March, the number of people who were out of the labour force—that is, those who were neither employed nor unemployed—increased by 644,000.

Of those not in the labour force, 219,000 had worked recently and wanted a job but did not search for one, an increase of 193,000 (+743%). Because they had not looked for work and they were not temporarily laid off, these people are not counted as unemployed. Since historically the number of people in this group is generally very small and stable, the full monthly increase can be reasonably attributed to COVID-19.

Increased absences show impacts of COVID-19

There were 1.3 million Canadians who were away from work for the full week of March 15 to 21, for reasons that can likely be attributed to COVID-19, including 'business conditions' and 'other reasons' but excluding reasons such as 'vacation'; 'labour dispute'; 'maternity leave'; 'holiday'; and 'weather'.

The number of Canadians who were employed but who worked less than half their usual hours due to 'business conditions' or 'other reasons' increased 800,000 in March. When these absences are included, the total number of people who missed all or part of their week increased to 2.1 million and the total number of Canadians who were affected by either job loss or reduced hours was 3.1 million.

For employees who were absent from a job for the full week, about 55.8% were not paid (not adjusted for seasonality). The number of people who were absent all week without pay may be an indication of future job losses. The Labour Force Survey does not collect information on whether people who are absent for part of the week were paid for the hours they did not work.

COVID-19 creates a complex picture: not working, but not unemployed

The unemployment rate is the number of people unemployed as a proportion of the total labour force (employed plus unemployed). In March, the unemployment rate increased by 2.2 percentage points to 7.8%, the largest one-month increase since comparable data became available in 1976.

In March, 219,000 people were not in the labour force but had worked earlier in March and still wanted a job. They were not counted as unemployed because they did not look for a job, presumably because of ongoing business shutdowns and the requirement to socially isolate. If this group were counted as unemployed, the adjusted unemployment rate would be 8.9%.

In March, the "recent labour underutilization rate" was 23.0%, meaning about one-quarter of the potential labour force was fully or partially underutilized. In comparison, this rate was 12.8% at the peak of the 2008/2009 recession, highlighting the depth of the impact of COVID-19 on the Canadian labour market.

The "recent labour underutilization rate" is calculated by combining all those who were unemployed with those who recently worked and wanted a job but did not meet the definition of unemployed; and those who remained employed but lost all or the majority of their usual work hours.

Most employment losses in the private sector; small declines among self-employed

Employment decreased more sharply in March among employees in the private sector (-830,200 or -6.7%) than in the public sector (-144,600 or -3.7%).

The number of self-employed workers decreased relatively little in March (-1.2% or -35,900), and was virtually unchanged compared with 12 months earlier. The number of own-account self-employed workers with no employees increased by 1.2% in March (not adjusted for seasonality). Most of this increase was due to an increase in the healthcare and social assistance industry (+16.7%), which offset declines in several other industries. At the onset of a sudden labour market shock, self-employed workers are likely to continue to report an attachment to their business, even as business conditions deteriorate.

Greatest employment declines among youth

Among youth aged 15 to 24, employment decreased by 392,500 (-15.4%) in March, the fastest rate of decline across the three main age groups. The decrease was almost entirely in part-time work, and brought the employment rate for youth to 49.1%, the lowest on record using comparable data beginning in 1976.

About two-thirds of youth are students, and employment fell more sharply among those enrolled in school (-31.6%), than among non-students (-1.8%), unadjusted for seasonality. Students are also more likely to work in the accommodation and food services industry, which had the largest declines overall.

Approximately 20% of employed youth lost all or the majority of their usual hours.

Unemployment for youth increased by 145,300 (+49.7%) in March, bringing their unemployment rate up 6.5 percentage points to 16.8%, the highest rate for this group since June 1997. An additional 88,400 (+1892.4%) youth wanted work in March but did not search due to reasons related to COVID-19 (not adjusted for seasonality). Including that group would result in a supplemental youth unemployment rate of 20.7% (not adjusted for seasonality).

COVID-19 affects both family earning ability and living arrangements

The ability of Canadians to withstand the economic hardship associated with COVID-19 depends on a number of factors, including their family and living arrangements.

Employment losses in March affected a range of family types, including couple families where one or both partners may have lost their job. Between March 2019 and March 2020, the number of spouses/partners in dual-earner couples decreased, while those in single and non-earner couples increased by 918,000 (+11.7%), unadjusted for seasonality.

In addition to employment impacts, directives to socially isolate at home may have affected living arrangements. A number of Canadians living alone or with non-relatives were faced with a choice to self-isolate by themselves or to move in with family members. On a year-over-year basis, unadjusted for seasonality, the total number of unattached individuals decreased by 128,000 (-2.2%), while the number of lone parents decreased by 38,000 (-3.5%). As a point of reference, the total Canadian population aged 15 and older increased by 1.6% over the same period.

Largest job losses in accommodation and food services industry

The federal and provincial governments issued social distancing orders or recommendations before and during the LFS reference week restricting the activities of many workplaces. Government measures instated early in the LFS reference period included states of emergency, restrictions on certain business activities, and limits on the travel of non-residents into the country.

Businesses and organizations may have responded to these unprecedented instructions in a number of ways. They could have reduced activities, resulting in a combination of reduced work hours, temporary layoffs, and permanent reductions in employment. Alternatively, they could have continued to operate as usual or continued operations with an increased reliance on telework, depending on the nature of their operations.

In March, the largest employment declines were recorded in industries which involve public-facing activities or limited ability to work from home. This includes accommodation and food services (-23.9%); information, culture and recreation (-13.3%); educational services (-9.1%); and wholesale and retail trade (-7.2%).

Smaller employment declines were observed in most other sectors, including those related to essential services, such as health care and social assistance (-4.0%). Employment was little changed in public administration; construction; and professional, scientific and technical services. An employment increase was observed in natural resources.

Even within industries which recorded the largest employment declines, not all occupations were equally affected. On average in 2019, employment in sales and service occupations represented about one-quarter of total Canadian employment, but in March 2020, these occupations accounted for 61.8% of the overall employment decline in the month, dropping by an estimated 625,000.

Jobs in this occupational group are relatively low-paid, indicating that the first workers to experience job losses as a result of COVID-19 are among those least able to withstand economic hardship. In 2019, the average hourly wage rate of employees in sales and service occupations was $18.36, compared with the total employment average of $27.83.

Large drop in total hours worked, led by declines in public-facing industries

The total of all hours worked across all industries was down 15.1% in March, the largest decline since the beginning of the series in 1976. Total hours worked declined in all provinces, led by Quebec (-18.9%).

As with employment declines, industries which involve public-facing activities or a limited ability to work from home saw the largest declines in hours worked. This includes accommodation and food services (-41.1%); information, culture and recreation (-30.6%); and educational services (-28.8%). Overall, total hours worked decreased more in the services-producing sector (-17.3%) than in the goods-producing sector (-8.3%).

Largest employment losses among vulnerable workers

In general, workers in less secure, lower-quality jobs, were more likely to see employment losses in March. The number of employees in temporary jobs decreased by 14.5% (-274,900) compared with a decline of 5.3% (-749,500) among employees with permanent jobs (unadjusted for seasonality). Decreases were observed across all types of temporary work, led by those in casual employment (-23.5% or -136,000). There were 5.0% fewer temporary workers with a term or contract position.

Temporary employees were more likely to lose all or the majority of their usual work hours (21.7%) compared with permanent employees (11.6%) in March, unadjusted for seasonality.

Not adjusted for seasonality, employment fell slightly more among employees not covered by a union or collective agreement (-7.0% or -777,600), and they were more likely to lose all or a majority of their usual work hours (19%). In contrast, the number of employees covered by a union or collective agreement fell by 5% (-246,900), and 13% lost all or a majority of their usual hours.

Half (49.9%) of the decline in employment among employees (not adjusted for seasonality) was accounted for by those earning less than two-thirds of the 2019 median hourly wage. Employment for this group declined by 15.8% (-510,800) in March, compared with a decrease of 4.0% (-513,600) among higher-paid employees. The number of low-wage employees who lost all or the majority of their hours increased by 545.5% (+496,000) in March, compared with an increase of 444.2% (+1,072,000) for higher-wage workers.

Multiple jobholding declines

The number of workers holding more than one job at the same time decreased by 25.6% (-283,200) in March (unadjusted for seasonality). As seen for total employment, youth (-33.6% or -44,900) and core-aged women (-30.5% or -127,200) saw the most notable declines in holding multiple jobs. The share of workers holding more than one job declined from 5.8% to 4.5%, a rate last seen consistently in the late 1980s. If workers are holding multiple jobs for financial reasons, this decline could compound the financial impact of the COVID-19 related business closures for some workers.

COVID-19 affects both family earning ability and living arrangements

The ability of Canadians to withstand the economic hardship associated with COVID-19 depends on a number of factors, including their family and living arrangements.

Employment losses in March affected a range of family types, including couple families where one or both partners may have lost their job. Between March 2019 and March 2020, the number of spouses/partners in dual-earner couples decreased, while those in single and non-earner couples increased by 918,000 (+11.7%), unadjusted for seasonality.

In addition to employment impacts, directives to socially isolate at home may have affected living arrangements. A number of Canadians living alone or with non-relatives were faced with a choice to self-isolate by themselves or to move in with family members. On a year-over-year basis, unadjusted for seasonality, the total number of unattached individuals decreased by 128,000 (-2.2%), while the number of lone parents decreased by 38,000 (-3.5%). As a point of reference, the total Canadian population aged 15 and older increased by 1.6% over the same period.

Accommodation and food services

In March, employment in accommodation and food services declined by 294,000 (23.9%) on a month-over-month basis. Employment declined at a similar rate in the two sub-sectors: food services and drinking places; and accommodation services.

The March decrease is by far the largest employment variation in the sector since comparable data became available in 1976. During the 2008/2009 recession, for example, employment in this industry declined by 5.4% in the 12 months to September 2009.

In March, the number of people employed in accommodation and food services declined in all provinces, ranging from 13.5% in Newfoundland and Labrador to 27.9% in Alberta.

In March 2020, half of those that were still employed in the accommodation and food services sector worked 15 hours or less per week, compared with an average of approximately 25% over recent years (data unadjusted for seasonality). One in four reported having worked zero hours, compared with an average of 7% over recent years. This increase in lost hours suggests that further employment losses may be observed in this sector in April. On the other hand, since the March LFS reference week, a number of restaurants have begun offering delivery and take-out services, an example of business adaptations which might partially mitigate further losses.

Information, culture and recreation

Employment in the information, culture and recreation sector decreased by 104,000 or 13.3% in March, with declines observed in all provinces.

On a year-over-year basis, employment declined in performing arts, spectator sports and related industries, consistent with the cancellation or postponement of large sports and entertainment events across the country.

Educational services

Employment in educational services declined by 9.1% (or 125,000) in March, the largest monthly decline in the sector since comparable data became available in 1976.

Most of the decline was observed in Quebec (-73,000) and Ontario (-25,000) while there were smaller declines in British Columbia, New Brunswick, Saskatchewan, Nova Scotia and Manitoba. Employment in educational services was little changed in the other three provinces. The Quebec provincial government announced the closure of all schools, universities and daycares on March 13. The government of Ontario made a similar announcement around the same time, as March break was about to begin in their province.

Compared with March 2019, declines were observed in non-professional occupations in education, such as educational support workers, while employment in professional occupations in educational services was little changed (not adjusted for seasonality). Employment declined by about 10% for those who were not covered by a collective agreement compared with about 4% for those who were (not adjusted for seasonality). Similarly, declines were proportionally greater in small institutions and businesses (less than 500 employees) (not adjusted for seasonality).

Wholesale and retail trade

The number of people employed in wholesale and retail trade declined by 208,000 or 7.2% in March.

Employment changes in subsectors reflect the need for some retail business to remain open despite widespread shutdowns and instructions to socially distance. For example, employment in subsectors related to food and beverages was relatively stable, while employment for clothing stores and other retail stores decreased.

Within wholesale and retail trade, the vast majority of the decline in employment was attributable to sales and services occupations, which represented over half of all the workers in the sector.

Local Top Line

• March Unemployment Rate: Brantford 5.9% [+] Ontario 7.6% [+] Canada 7.8% [+]
• The local unemployment rate increased by 1.2 month over month.
• The local labour force contracted by 800 month over month.
• The number of employed decreased by 1,700 month over month.
• The number of unemployed increased by 900 month over month.
• When compared to the surrounding CMAs of Hamilton, Niagara, Waterloo, Guelph, and London, Brantford’s unemployment rate is in the middle.

Note: Brantford's unemployment reflects a 3 month moving average, whereas Ontario and Canada are monthly figures. The sample CMA breakdown for Brantford area is detailed in text at the Stats Canada website: http://www23.statcan.gc.ca/imdb/p3VD.pl?Function=getVD&TVD=117159&CVD=117161&CPV=543&CST=01012011&CLV=2&MLV=3