Canadian Labour Market
Canada's labour market fully recovered in February as some provinces lifted public health measures for COVID-19.
Between February 13 and February 19, Statistics Canada assessed the performance of the Canadian labour market. Canada's unemployment rate fell to 5.5 percent in February, below pre-pandemic levels for the first time. Prior to the pandemic, the unemployment rate was 5.7% in February 2020 and a record low of 5.4% in May 2019. The overall unemployment rate for immigrants in February 2022 was 5.7 percent, compared to 5.9 percent in the same period in 2020.
Employment in January was lower than in February due to strict public health measures in January. Canada added 377,000 jobs in February. Employment growth was most pronounced in the accommodation and catering, information, cultural and entertainment sectors. Employment increased in eight provinces, with employment in Alberta and New Brunswick remaining stable.
Employment in Canada
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LHH President Jim Mitchell said the labor market recovered faster than expected in February. As the pandemic wanes, employers across the country want to retain talent, and employment rates return to pre-pandemic levels.
The overall employment rate, or the proportion of the population over 15 years old, rose to 61.8 percent in February. Nathan Janzen, an economist at RBC, writes that there is still a shortage of labor and many positions remain vacant. The reduction in the number of available workers has made it difficult for businesses to recruit across industries, and employment in the accommodation and food service industries remains well below pre-pandemic levels. Wages are rising, with average hourly earnings rising 3.1 percent in February from a year earlier and 2.4 percent in January.
As wages have risen, so has the cost of living in Canada. According to the Consumer Price Index, Canada's inflation rate in January exceeded 5% for the first time since September 1991. Statistics Canada also said labour force survey data for the coming months would show whether average hourly wages would increase with inflation.
In February, Canada unveiled its 2022-2024 immigration plan, which shows that new immigrants will continue to increase over the next three years, and the immigration program reflects the high demand for labor in many industries in Canada.
Economist Liam Daly mentioned that during the epidemic, there has been a surge in job openings in Canada. As the pandemic has disrupted international mobility, the Canadian government is increasingly relying on converting temporary residents of Canada into permanent residents. While this approach will remain an important conduit for migration, the government must work to increase the volume of migrants from abroad, given the urgent need to address the labor shortage.
The pandemic has reshuffled many industries in Canada, and as the economy slowly recovers from the pandemic, the job market and immigration policies are more friendly to those who want to immigrate to Canada.