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Pandemic shutdown causes unparalleled disruption in labour market

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The COVID 19 pandemic shutdowns caused an unparalleled disruption in Ontario’s labour market, with the province’s employment declining by 355,300 jobs (or 4.8 per cent) in 2020, marking the largest annual loss of employment on record, a report from the Financial Accountability Office said on Thursday.
The annual unemployment rate jumped to 9.6 per cent in 2020, the highest since 1993 but lower than observed in most previous recessions.
The rise in the unemployment rate in 2020 was tempered by a surge in individuals who left the labour force and as a result were not counted as unemployed.
Due to these exits, the province’s labour force participation rate dropped to 63.6 per cent, down sharply from 64.9 per cent in 2019 and the lowest rate on record, the report said.
The decline in employment in 2020 was broadly based and affected workers in all age groups, industries and major cities across the province. While this report focuses on average annual data, employment fluctuated dramatically over the course of the year, declining sharply in the spring during the initial pandemic lockdowns, followed by a rapid increase over the summer as the economy reopened.
On an average annual basis, a large majority of job losses were concentrated in the private sector ( 288,600 or 6.0 per cent), driven by the accommodation and food services, and wholesale and retail trade industries. Self employed ( 50,100 or 4.3 per cent) individuals also experienced record job losses, led by declines in construction, and transportation and warehousing industries. Public sector workers lost 16,600 jobs (or -1.2 per cent), with losses concentrated in educational services, and information, culture and recreation industries.
Female workers ( 202,600 or 5.8 per cent) experienced larger job losses compared to male workers ( 152,600 or 3.9 per cent), with declines across all major age groups. While female workers recorded similar employment declines compared to male workers in some of the hardest hit industries, they experienced far larger job losses in information, culture and recreation, and real estate, rental and leasing. The pandemic also created additional labour market attachment challenges for mothers with young children.
Young workers (ages 15 24) were deeply affected by the pandemic, with employment declining at five times the pace of job loss for workers aged 25 and over. The job losses among young workers were concentrated in the accommodation and food services, and information, culture and recreation industries. Part time workers ( 152,300 or 11.1 per cent) lost jobs at a much faster pace compared to full time workers ( 202,900 or 3.4 per cent), a trend that was prevalent across all age groups.

 

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