In normal circumstances, the loss of more than 200,000 Canadian jobs in a single month couldn’t be construed as anything but a horrific train wreck.
But our current circumstances are far from normal. And under the circumstances – with deepest apologies to the people who had their livelihood snatched from them by the second wave of the pandemic – some of the details of last Friday’s January employment report looked a lot more encouraging than the dismaying headlines. There’s a remarkably resilient economy poking out beneath the ugly surface.
And ugly it is. Statistics Canada reported the country shed 213,000 jobs in January, the worst month since last spring’s nosedive triggered by the first COVID-19 lockdowns. The unemployment rate jumped to 9.4 per cent from 8.8 per cent, a five-month high.
That was, obviously, bad news; combined with the loss of 53,000 jobs in December, the second wave of the pandemic has delivered a serious setback to the recovering economy.
Or has it?
As ugly as those numbers are, they are a tiny fraction of what was lost in last spring’s lockdowns. That alone suggests the economy is weathering the second wave much better than it did the first.
There’s another number, one that gets relatively little attention in normal times, that really hammers home that point. Total hours worked – the number of hours put in by all employed Canadians in the month – actually rose 0.9 per cent in January, despite the job losses. While part-time employment slumped, the number of full-time jobs grew.
It indicates that, over all, even in the second-wave lockdowns, the total demand for labour didn’t drop off. Outside of the sectors most directly hit by mandatory shutdowns – retail, restaurants and accommodation, culture and recreation – employment was up by nearly 70,000 in December and January.
Similarly, outside of the two provinces that imposed much stricter shutdown restrictions beginning in late December – Ontario and Quebec – employment in the rest of the country was up nearly 40,000 in January.
For the economy as a whole, these are remarkably healthy signs. Unlike last spring’s lockdowns, which had a deep and sweeping effect on the economy, it appears we’ve learned how to keep the economy rolling even as we have put some pockets on temporary pause. The underlying recovery remains largely intact.
What’s more, job growth has been skewing toward full-time work during much of the recovery since last spring’s reopening. In the past six months, full-time employment is up by nearly 5 per cent, or nearly 700,000 jobs; part-time employment is down by more than 6 per cent, or more than 200,000 jobs. Even before the employment downturn of the past two months, growth in full-time jobs since July had outpaced part-time growth by more than 5 to 1. Some sectors with the heaviest proportion of full-time jobs – such as the financial sector, and professional, scientific and technical services – have long ago exceeded their pre-COVID-19 employment levels.
There is no question that many of those part-time jobs will return – along with additional full-time jobs – when closed businesses are allowed to reopen, which could happen as soon as this month. The employment data outside of the affected sectors suggest they will return to a resilient economy that is poised for growth, with abundant stimulus both from governments’ ample spending and central banks’ low interest rates.
Still, the employment data serve to emphasize the sharp divisions the pandemic has opened in the labour force – between workers in predominantly services-sector jobs that are much more frequently part-time and less secure by nature, and those in more secure full-time work that is well removed from the pandemic’s front lines and that can easily be transported to a home office.
The heaviest hit by the January job losses were younger workers, racialized workers and women in the prime working age (25 to 54) – groups that have suffered the most throughout the pandemic. For them, the January job report only served to intensify just how unfair this pandemic has been on the country’s most disadvantaged workers.
The widening of these divisions between the labour market’s haves and have-nots makes abundantly clear the task now facing policy makers in Ottawa. The second wave has shown that much of the economy is increasingly capable of standing on its own two feet. It’s time to narrow government supports to directly address the groups whose scars from the pandemic are still deepening.
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