Canadian labour market faced the first jobs loss since April

Indeed, the seven-month marathon of increases reported at Canada’s labor market has come to an end in December, as the governments had to tightened restrictions to fight the second wave of COVID-19 cases.

According to Statistics Canada, Canada lost 62,600 jobs last month, while economists predicted a decrease of 37,500. As a result, the unemployment rate was up by 0.1% monthly to 8.6%.

New strains of COVID-19, uncertainty around the pace of population vaccinating, and longer post-holiday lockdowns are damaging the possibilities of an improvement in January.

“Because of the on-going growth in virus cases and the further activity slowdown, January may also bring job losses,” – says Royce Mendes, an economist at CIBC.

However, there’s still optimism that the economy will keep recovering as soon as the pace of vaccinations goes up.

Although the labor market has offset 79% of the 3 million positions lost during March and April, Canada is still down 636,000 jobs from February. It’s even more than about 430,000 jobs lost at the peak of the 2008-2009 recession.

Last month, the number of working hours were down by 0.3%.

The largest losses were reported in the sector of part-time jobs, among youth and seniors, and in services sectors. Meanwhile, full-time positions were up. Goods-producing sectors showed higher employment last month, driven by manufacturing. Public sector employment also saw an increase offsetting fewer positions at the private sector.