Unemployment rate spikes in Ottawa-Gatineau amid COVID-19 slowdown

Ottawa received its first official – albeit incomplete – look at the magnitude of job losses in the National Capital Regional stemming from efforts aimed at controlling the COVID-19 pandemic on Thursday as Statistics Canada released its latest employment figures.

The federal agency reported that more than 17,200 Ottawa-Gatineau residents were laid off or left their jobs in March. That pushed the official unemployment rate to 5.1 per cent, up from 4.3 per cent in February. The figures represent – by a wide margin – the largest number of jobs lost in a single month, as well as the sharpest jump in the unemployment rate, in more than a decade.

However, Statistics Canada’s mid-month employment report fails to tell the full story of how coronavirus-related restrictions have affected employment in the nation’s capital. 

Because of the relatively small local sample size, Statistics Canada presents its monthly jobless figures using a three-month rolling average. In other words, March’s unemployment numbers for Ottawa-Gatineau also incorporate data from January and February and therefore understate the impact of orders to close non-essential businesses as well as the mobility restrictions that were introduced last month.

Large swathes of Ottawa’s economy have effectively shut down in the wake of the COVID-19 pandemic as restaurants, hotels, retailers and other businesses dramatically scale back their operations or close entirely. Many have been forced to lay off employees, reduce hours or introduce salary reductions.

March’s snapshot shows Ottawa’s retail and wholesale sector was among the hardest hit, shedding 6,000 jobs. The accommodations and food services contracted by 5,400 employees.

However, two of the region’s most closely watched industries appeared to be holding steady in the early part of the crisis.

Statistics Canada reported that the region’s tech sector actually gained 2,300 positions. The city’s largest employer – the federal government – contracted by 3,200 employees, but that represents a decline of less than two per cent from the all-time employment high set in February.

Across the country, Statistics Canada reported the economy lost 1,011,000 jobs in March as the COVID-19 crisis began to take hold, lifting the unemployment rate up to 7.8 per cent.

The 2.2 per cent increase in the national unemployment rate marks the worst single-month change over the last 40-plus years of comparable data and brings the rate to a level not seen since October 2010.

Economists warn the numbers are likely to be even worse when the agency starts collecting April job figures, with millions more Canadians now receiving emergency federal aid.

Statistics Canada retooled some of its usual measures of counting employed, unemployed and “not in the labour force” to better gauge the effects of COVID-19 on the job market, which has been swift and harsh.

The number of people considered unemployed rose by 413,000 between February and March, almost all of it fuelled by temporary layoffs, meaning workers expected their jobs back in six months.

The jobs report out this morning also says that most of the losses were in the private sector, with the greatest employment declines observed for youth aged 15 to 24.

– With reporting by The Canadian Press