Question Period Note: Labour Force Survey for November 2021

• Employment jumped by 154,000 in November, well above expectations of a 37,500 gain.

• The unemployment rate fell sharply by 0.7 percentage points to 6.0% in November. The labour force participation was 65.3% in November, unchanged from October.

• The Canadian labour market recovery took a large step forward in November.
• Canada has now recovered 106 per cent of the jobs lost during the pandemic compared to just 83 per cent in the U.S. and faster than any other recession.
• Still, the recovery is uneven and the Omicron variant demonstrates that the pandemic is still with us, threatening Canadian’s health and livelihoods.
• The government is determined to do what is necessary to accelerate the recovery, moving from very broad-based support to more targeted measures that will provide help where it is still needed, to create jobs and set the stage for strong, sustained growth for years to come.

N/A

• Bottom Line: A very positive report, with the labour market recovery taking a larger-than-expected step forward in November following solid progress throughout the summer. This marks the sixth consecutive monthly employment gain, while the unemployment rate is at its lowest (6.0%) since the start of the pandemic and close to its pre-pandemic level (5.7%).

• Recovery Relative to Pre-Pandemic: In Canada, 106% of the jobs lost since the peak of the pandemic have been recouped, well ahead of the U.S. (83%). The labour force participation rate held steady at 65.3%, near its pre-pandemic level (65.5%) and well above the U.S. rate of 61.6% (1.7 p.p. below pre-pandemic), indicative of Canadians’ confidence in labour market prospects.

• Workers Impacted by COVID: While job losses have been fully recouped, about 155,000 workers continue to work less than half their usual hours, up slightly from 117,000 in October. The share of Canadians employed remains 0.4 p.p. lower than in February 2020, meaning 130,000 Canadians would need to be hired to reach the pre-pandemic rate given population growth. Adjusting for aging of the population, the pre-pandemic employment rate was exceeded in November. The number of long-term unemployment fell 62,000 in the month, but remains elevated, with 318,000 unemployed for more than 6 months (about 139,000 above pre-pandemic level).

• Full-time Jobs and Hours Worked: November saw gains in both full-time (+80,000) and part-time work (+74,000). Very positively, total hours worked rose a robust 0.7% in November, returning to its pre-pandemic level for the first time.

• Industry Breakdown: Service industries continue to drive the rebound (+127,000) with gains in health care and social assistance (+44,000), retail trade (+34,000) and professional, scientific and technical services (+28,000). Jobs in accommodation and food services held steady and is still more than 200,000 below pre-pandemic levels. The goods sector also rose (+26,000), marking the first increase in this sector since March 2021, and mostly attributable to an increase in manufacturing (+35,000) as several motor vehicle factories restarted production.

• Provincial Breakdown: Employment rose in Ontario, Quebec, Alberta, Newfoundland and Labrador, Nova Scotia and Prince Edward Island. All other provinces recorded little change.

• Demographics: Employment rose for both women (+66,000) and men (+48,000) in the core working age group of 25 to 54, with gains concentrated in full-time work. The employment rate for core-aged women reached an all-time high of 80.7%.

• Wages: Wage pressures generally remain moderate. The 2-year annualized growth in hourly wages (after adjusting for compositional changes driven by the pandemic) was 2.6% in November, up slightly from 2.5% in October.

• Outlook: Still rising vaccination rates and vaccine passports should mitigate the risk of widespread restrictions. However, some headwinds could slow the job recovery in the near-term including the new Omicron variant and ongoing supply chain issues. Any impact from the BC floods will be felt beginning with the December LFS as the floods started just after the November reference week (November 7 – 13).