10/09/2020 10:06 EDT | Updated 10/09/2020 13:38 EDT

Canada's Unemployment Rate Drops To 9% In September As Country Adds More Jobs Than Expected

The data doesn't reflect the pandemic-related restrictions introduced this fall.

Zou Zheng/Xinhua via Canadian Press
A worker wearing a face mask cleans a handrail at CF Toronto Eaton Center in Toronto, June 24, 2020. Canada added more jobs than expected in September as the economy rebounded from the spring lockdowns, but new restrictions this fall could slow the trend.

Canada added 378,000 jobs in September, more than doubling economists’ expectations as the country continued to recover from the economic shock of the spring lockdowns.

Relative to population, Canada added jobs some five times faster than the U.S., which added 661,000 jobs in September.

But economists are warning that, with parts of Canada well into a second wave of COVID-19 infections, last month’s unemployment numbers won’t tell us much about what’s ahead.

The unemployment rate fell to 9 per cent in September, after reaching a peak of 13.7 per cent in May, Statistics Canada said in its Labour Force Survey released Friday morning.

Ontario and Quebec saw the largest job gains, while New Brunswick and Prince Edward Island were the only provinces to see job losses in the month.

Watch: U.S. adds 661,000 jobs in September. Story continues below.


Statistics Canada was quick to point out that September’s job numbers are a snapshot of the situation as it was the week of Sept. 13 to 19. That was shortly after British Columbia introduced new pandemic restrictions, but just before Ontario and Quebec did so.

Canada had recovered all but 3.7 per cent of the jobs it lost in the early months of the pandemic by mid-September, but the recovery has been uneven. 

Two sectors of the economy ― food and accommodation, as well as retail ― are still well below normal, accounting for the lion’s share of the lost jobs.

Despite strong job growth for youth in September, employment in the 15 to 24 age group is still more than 10 per cent below pre-pandemic levels, StatCan said. The jobless rate for youth was 20.5 per cent in September, down from 25.6 in August.

Women, who lost work faster than men in the spring, have now gained an edge over men in the recovery. Women aged 25 to 54 have recovered all but 2.1 per cent of their jobs, while men in the same age group are 2.4 per cent below pre-pandemic levels.

StatCan in recent months began collecting racial data on employment, showing that racialized groups in Canada were hit harder by the pandemic shutdowns.

But September’s figures show rapid job gains for some groups as the economy reopened. Black Canadians saw their jobless rate drop to 11.7 per cent, from 17.6 per cent the month before, while Filipino Canadians saw their jobless rate drop to 8.5 per cent (below the national average) from 12.7 per cent the month before.

Still, economists cautioned not to read too much into this month’s data, because of the rapidly evolving situation with COVID-19. 

“The country is now faced with new virus cases clearly trending in the wrong direction, threatening to upend the labour market recovery,” CIBC economist Royce Mendes wrote in a client note.

“As a result of that ... development, not much can be extrapolated from the solid print for September to future labour market readings.”

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