Canada’s Unemployment Rate Shoots Up to 13%, Nearly 2 Million Jobs Lost in April

May 8, 2020 Updated: May 8, 2020

OTTAWA—The Canadian economy lost almost two million jobs in April, a record high, as the closure of non-essential services to slow the spread of COVID-19 forced businesses to shutter temporarily.

The loss of 1,993,800 comes on top of more than one million jobs lost in March, and millions more having their hours and incomes slashed.

The unemployment rate soared to 13.0 percent, Statistics Canada reported, as the full force of the pandemic hit compared with 7.8 percent in March.

It was the second highest unemployment rate on record as job losses spread beyond the service sector to include construction and manufacturing.

Economists on average had expected the loss of four million jobs and an unemployment rate of 18 percent, according to financial markets data firm Refinitiv.

The unemployment rate would have been 17.8 percent had the agency’s labour force survey counted among the unemployed the 1.1 million who stopped looking for work—likely because the COVID-19 economic shutdown has limited job opportunities.

In all, more than one-third of the labour force didn’t work or had reduced hours in April, an “underutilization rate” that was more than three times higher than in February before the pandemic struck.

“Canadians should be confident that we will do whatever we can to ensure that their jobs are safe as we continue to fight the global COVID-19 outbreak,” a trio of federal cabinet ministers said in a joint statement this morning in response to the jobs report.

“As provinces and territories begin to lift restrictions and our government continues to take steps towards economic recovery, we will be there for Canadians.”

Vulnerable workers who tend to have part-time or temporary work, or in low-paying jobs have been particularly impacted with heavy job losses. Women have seen larger job losses overall, but the number of men out of work in April closed the gender gap in cumulative unemployment losses.

Nearly all of the job losses for men since February were in full-time work, compared to 69.9 percent for women.

“This, combined with the different industries in which men and women have lost their jobs—for example, more job losses among men have been in construction, and fewer have been in retail trade—signals that the challenges associated with recovering from the COVID-19 economic shutdown may be different for women and men,” the labour force survey says.

In March, health restrictions forced the closure of non-essential businesses, leading to layoffs and cuts in work hours as companies tried to manage costs without enough or any revenue coming in.

Smaller companies—defined as those with less than 20 employees—have shed 30.8 percent of their workers, medium-sized firms have let 25.1 percent of workers go, and large companies have seen employment decline by 12.6 percent.

Hard-hit sectors at the outset include retail, hotels, restaurants and bars, which continued to see losses in April. The losses in the service sector continued in April, down 1.4 million or 9.6 percent, Statistics Canada says.

Proportionally, the losses were greater in goods-producing sectors like construction and manufacturing, which combined lost 621,000 jobs for a drop of 15.8 percent after being virtually unchanged in March.

Job losses in April were spread across all provinces, with Quebec particularly hard-hit. The unemployment rate in the province climbed to 17 percent, the highest rate among all provinces and the highest rate for Quebec itself in over more than four decades of comparable data.