Canadian employment plummeted in January and work absences due to illness soared to record levels as the Omicron variant drove a steep uptick in COVID-19 infections.
The country lost 200,000 jobs last month, the first decline in employment since May, Statistics Canada said Friday. The unemployment rate rose to 6.5 per cent from December’s 6 per cent. Job losses were worse than expected: The median estimate by financial analysts was a loss of 110,000 positions, ending a seven-month streak that saw job creation of nearly 800,000.
The effects went well beyond layoffs. Total hours worked across the economy fell 2.2 per cent in January. And during the week of Jan. 9 to 15, roughly 1.6 million people were employed but worked less than half their usual hours, an increase of 620,000 from December.
One in 10 employees were absent from work for all or part of that week due to illness or disability – a record portion and about one-third higher than a usual January.
For the Canadian economy, the January jobs report imparted a sense of déjà vu. Job losses were highly concentrated in Ontario (146,000) and Quebec (63,000) after those provinces enacted tighter health measures. And once again, it was close-contact service industries that bore the brunt of layoffs: More than half of the job losses were in hospitality.
But if past COVID-19 waves are any indication, employment should snap back quickly as Omicron fades and restrictions are loosened. That process is already under way. On Monday, Ontario allowed several of its battered service industries – such as gyms and indoor dining – to reopen at a reduced capacity. Quebec is also gradually opening up.
“Although the Omicron wave took a heavy toll on the labour market at the start of 2022, employment is likely to bounce back strongly this month,” Stephen Brown, senior Canada economist at Capital Economics, wrote in a note to clients. “And with many businesses looking to increase their pace of hiring, it won’t be long until the unemployment rate drops back below 6.0 per cent,” he added.
Article From: Globe and Mail
Author: MATT LUNDY
