The Impact of COVID-19 on the Canadian Job Market |

Jobs & Career

The Impact of COVID-19 on the Canadian Job Market



Since COVID-19 broke out, Canada’s labor market has been in a state of flux. The pandemic’s impact has been felt deeply in workers’ wages, hours worked, and unemployment rates across the country.

Canada’s employment situation has recovered more rapidly than in the United States, and its participation rate even reached pre-pandemic levels relatively early on.

Unemployment Rates

The Canadian job market has felt the full brunt of COVID-19 restrictions since March 2020, when they went into effect. Employment levels across Canada have plummeted sharply as a result.

Unemployment rates remain high and the number of unemployed persons has been growing. Nevertheless, unemployment remains below pre-COVID levels and at or near a five-decade low.

In January 2021, the unemployment rate rose 0.5 percentage points to 6.5%; this was the first rise since April 2021 when COVID-19’s third wave began. This increase was primarily attributed to an increase in those unemployed or expected to start work within one month.

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In January, job losses were primarily concentrated among youth aged 15-24 and men and women 25-54. Industries most affected included accommodation/food services, arts/recreation, as well as visible minorities and Indigenous groups. Furthermore, there was a decline in employment opportunities for these groups.

Employment Gains

Canada’s job market had been experiencing a period of relative stability for some time. The unemployment rate declined almost annually, reaching its lowest point in 2019 at 5.7%.

However, the COVID-19 pandemic drastically altered everything. It caused widespread disruptions to work environments as well.

Many workers in industries affected by the virus (like healthcare, food, and transportation) found it difficult to secure new employment or get their old ones back. Furthermore, many workers were required to take unpaid leave.

Furthermore, the labour market experienced numerous inequalities due to factors such as age, gender, and education.

Employment in services declined more than the goods sector during the pandemic but was offset by an uptick in professional, scientific, and technical occupations. Other sectors which experienced a boost from services included management of companies and health care. In America however, service employment rose faster than Canada’s did.

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Job Vacancies

In the early months of COVID-19, many countries were forced to shut down their businesses and leave workers without jobs. While this was a significant blow for many individuals, the job market has since rebounded impressively.

Statistics Canada reported a record-high number of job vacancies in the fourth quarter of 2021, signaling employers’ difficulty in finding qualified personnel to fill positions.

In the first quarter of 2022, there were 33.6 new hires per 100 vacancies – significantly higher than in 2021 but still lower than before the pandemic.

Remote Work

Remote work is here to stay, and its popularity is likely to continue to expand. Therefore, employers must understand how this shift will influence their hiring and retention strategies.

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One of the greatest effects of the COVID-19 pandemic was that many employees were forced to work remotely for months at a time. While some may have preferred staying onsite, many have discovered that working from home provides them with an ideal opportunity to achieve work-life balance.

The pandemic has had another major effect on many people: they are more motivated and eager to work remotely than before. This can be great news for employers, as remote employees may be even more productive and efficient than their onsite counterparts.

Even with increased productivity, remote workers still require proper management to guarantee they complete their tasks. That is why it is essential for organizations to create a company culture that encourages remote employees to feel part of the team and contribute towards the company’s overall vision.