Canada has recorded a notable 15.7% decrease in work since February this year and lost almost 2,000,000 positions in April as a major aspect of the monetary effect of the Covid-19 pandemic.
These details were provided by the government agency Statistics Canada or StatCan in its Labour Force Survey. As a result, Prime Minister Justin Trudeau has extended a wage subsidy programme that was scheduled to last till June 6.
The decline in employment since February “far exceeds” those seen in downturns in the past including the global economic meltdown in 2008-2009 and previous recessions. For April alone, the unemployment rate rose to 13%, with 1.93 million new unemployed.
The overall scenario could even be worse, as StatCan noted, “The April unemployment rate would be 17.8% when adjusted to reflect those who were not counted as unemployed for reasons specific to the Covid-19 economic shutdown.” This, it explained, was because many people wanted to return to work once their industries reopened after the forced shutdown due to Covid-19 and could not be counted among the unemployed.
“In April, more than one-third (36.7%) of the potential labour force did not work or worked less than half of their usual hours, illustrating the continuing impact of the Covid-19 economic shutdown on the labour market,” StatCan added, pointing to the adverse impact of the coronavirus crisis beyond the topline numbers.
Adjustments due to the disease were also reflected in the data. Nearly five million people worked from home, including 3.3 million who usually worked at a location other than their residence. StatCan stated, “The actions taken by various levels of government to protect public health amounted to an intentional shutdown of the economy which resulted in a sudden shock to the Canadian labour market.”
Given the uncertainty ahead, the Canadian government has decided to extend a wage subsidy programme, which was to expire on June 6. The CA$ 73 billion initiative provides businesses, stressed by the crisis, 75% of their payroll, up to about CA $ 3500 per month per employee, in an effort to get them to retain workers.
Trudeau cited the StatCan job numbers to announce that the programme will continue beyond the original end date. The extension, he said, will be necessary to “kickstart” the economy once the country returns to a degree of normalcy after the worst of the crisis has passed.