The last of the good news?

Canadian employment data for September, released this morning by Statistics Canada, were remarkably strong, at both the headline and the detailed level. Employment rose by 378,000 in the month, more than twice what the analysts' consensus had foreseen.  This reduced the national unemployment rate to 9.0 percent from 10.2 percent in August. For the second straight month, almost all of the job gains represented full-time employment.  

In terms of the details, there were job gains in all Provinces except New Brunswick and PEI. There were strong job gains in the goods producing sector, led by manufacturing. The services sector also posted solid gains, led by the accommodation and food services sub-sector, and by educational services as schools reopened in most Provinces. The number of Canadians working fewer than their usual hours as a result of the pandemic continued to fall, and the number of people still working from home edged lower. 

It scarcely needs to be pointed out that the labour market remains far below its pre-pandemic levels. The 9.0 percent unemployment rate compares to a 5.6 percent rate recorded in February, the last pre-pandemic month. Aggregate employment remains 720,000 (about 3.7 percent) below its February level. Although manufacturing employment is close to recouping al the jobs lost to the pandemic, and employment in educational services is actually above February's level, employment in both accommodation and retail trade remains far short of its peak. 

Sad to say, it is very likely that today's data represent the last positive news on employment that Canada will see for many months. The emergence of the feared second wave of COVID-19 has seen a rapid spike in cases in the most populous Provinces. In response, BC started to reimpose lockdown measures in early September; Quebec followed suit at the end of the month, and Ontario has just today announced fresh restrictions in its worst-affected regions, including Toronto and Ottawa.  StatsCan's monthly survey to collect job market data for October takes place next week; the new restrictions, though less severe than those imposed in the spring, are sure to weigh heavily on the data for this month and, in all likelihood, the rest of the year.