MONTREAL ― More than one million jobs disappeared in Canada in March, according to the monthly labour force survey from Statistics Canada, pushing the jobless rate to 7.8 per cent.
The data showed another two million Canadians who still have work have seen their hours cut. Of those, 800,000 have seen their hours cut to zero.
These people “could be seen as at risk of losing their job in the months to come,” CIBC economist Royce Mendes wrote in a client note Thursday.
StatCan’s numbers don’t necessarily reflect the size of the COVID-19 economic emergency, as they amount to a snapshot of 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,” StatCan said.
“These interventions resulted in a dramatic slowdown in economic activity and a sudden shock to the Canadian labour market.”
It was the fastest one-month increase in the jobless rate in comparable records going back to 1976, StatCan said. The jobless rate in February had been 5.6 per cent.
“This single report wiped out 40 months of net employment gains, and the worst is yet to come,” TD Bank senior economist Brian DePratto wrote.
“Reports that more than four million Canadians have already applied for various income support measures (EI and the Canada Emergency Response Benefit) remind us that as bad as the March data was, we’re not yet looking at the full COVID-19 impact.”
The latest jobless rate “would have been worse if it were not for the huge pullback in labour force participation,” CIBC’s Mendes wrote. “With large swaths of the economy shut down, many of those who lost their jobs apparently simply chose to wait to look for new employment until conditions improved.”
The employment rate ― the share of the working-age population that has a job ― fell to 58.5 per cent, its lowest level since 1997, Mendes noted.
Economists expect the labour market to weaken further. In a report issued Thursday, Royal Bank of Canada predicted the jobless rate would average 14.5 per cent between April and June of this year.