6 February 2009

Job losses worst on record

The following is excerpted from the 6 February 2009 edition of “Toronto Star”.

The recession hit home where Canadians live last month as a massive 129,000 workers joined the ranks of the unemployed and the country's jobless rate surged to 7.2 per cent.

More than half the jobs lost were in Ontario where manufacturers, particularly carmakers, have been hit hard. The province's unemployment rate rose to 8 per cent, up from 7.2 per cent in December.

In Toronto, the ranks of the unemployed grew to 7.8 per cent, rising a one-half percentage point from the previous month.

Meanwhile, in the U.S. employers slashed payrolls by 598,000 in January, the most since the end of 1974, catapulting the unemployment rate to 7.6 percent. The losses were far worse than the 525,000 economists expected. So was the rise in the unemployment rate, now at the highest since September 1992.

Across the country, it was the worst monthly employment drop in at least three decades, topping figures seen in either of the two previous recessions in the 1980s and 1990s.

Almost all the jobs were full-time and were mostly in a battered manufacturing sector that has been most affected by the severe downturn in the United States.

The carnage was everywhere. Ontario shed 71,000 jobs, half in the manufacturing sector. British Columbia and Quebec workers were also hit hard with losses of 35,000 and 26,000 respectively.

Since October, when most economists say the global recession hit Canada's shores, the country has lost a whopping 213,000 jobs, wiping out a year's gains.

The January losses were not totally unexpected given the trend in labour markets both in Canada in the U.S. since the fall, but economists had been forecasting a much tamer number of around 40,000…

Statistics Canada officials were scrambling to describe the number of firsts – all bad – that January's labour survey created.

It was the largest employment decrease since the agency began keeping what it described as comparable figures in 1976.

And the manufacturing loss was the worst single month contraction on record.

The jump in unemployment rate from 6.6 per cent in December did not set a record, however, although it was the biggest monthly increase since 1992.

As ugly as the aggregate numbers are, the details are not much prettier in terms of describing the lamentable state of the economy.

The vast majority of the job losses were full-time, private sector and among the core category of adults between 25 and 54 years of age. But the public sector did not emerge unscathed, losing 42,000 jobs.

If there was any light shining through the black clouds it was in the fact that Canadians that still had jobs were earning more, 4.8 per cent higher than a year ago.

Almost all sectors reported job losses, including transportation and warehousing, business, building, and factory jobs dealing with furniture, computer and electronics, non-metallic mineral products, electrical equipment, appliance and components, and clothing.

Employment in health care and social assistance did increase in January, picking up 31,000, however.
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Unemployment numbers for major cities. (Previous month in brackets.)

— St. John’s 7.1 (7.2)
— Halifax 5.6 (5.3)
— Montreal 7.8 (7.5)
— Ottawa 4.5 (4.6)
— Toronto 7.8 (7.3)
— Windsor10.9 (10.1)
— Winnipeg 4.5 (4.5)
— Calgary 4.1 (3.9)
— Vancouver 5.1 (4.8)