Ottawa-Gatineau unemployment rate falls to 9.1% in July

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Photo by Michael Cristalli on iStock

Ottawa-Gatineau’s unemployment rate dipped slightly in July as more local businesses continued to reopen following the COVID-19 lockdown, Statistics Canada said late last week.

The region’s jobless rate was 9.1 per cent last month ​– down from 9.5 per cent in June. 

Statistics Canada uses a three-month rolling average to calculate the region’s unemployment rate, meaning the latest figures still reflect much of the period in May and June in which many businesses were shuttered and local residents were asked to stay home to reduce the spread of the coronavirus. 

Two key drivers of the region’s economy – the federal government and the tech sector – shed jobs in July, with employment in public administration falling by more than 2,000 and tech payrolls shrinking by 1,200 positions.

But with businesses such as restaurants and gyms being allowed to welcome customers back inside their premises and more and more retailers reopening their doors last month, employment levels in many other sectors bounced back.

The retail sector gained more than 8,000 jobs in July, while the hard-hit accommodation and food services sector added nearly 5,000 positions as hotels and restaurants began seeing more guests. The construction and health-care industries also experienced job growth last month.

Nationally, Canada's labour market gained 418,500 jobs in July, moving past the halfway mark in recouping the three million losses at the onset of the COVID-19 pandemic. Combined with the 953,000 jobs gained in June and the 290,000 in May, the country was within 1.3 million jobs of pre-pandemic level.

The unemployment rate was 10.9 per cent last month, down from the 12.3 per cent recorded in June and sliding further away from the record-high 13.7 per cent in May.

Ontario leads in jobs gains

Going forward, the country isn't likely to see another bump like June where large reopenings skewed the numbers, said Brendon Bernard, an economist with job-posting site Indeed Canada. The tail winds of ongoing reopenings in food and accommodation services, gyms, barbershops and hair salons helped again in July, he said.

Regionally, Manitoba, Saskatchewan, New Brunswick and Quebec recorded single-digit jobless rates. Ontario led the way in jobs gains, but its reopening has lagged other provinces and suggests a decent gain in August is possible, BMO chief economist Douglas Porter wrote in a note.

The Liberals estimate some four million people receiving the Canada Emergency Response Benefit will be moved onto employment insurance in the fall when the aid program begins winding down. The federal government has vowed changes to the decades-old EI system to ease access, and a new parallel benefit for those who don't qualify.

Parisa Mahboubi, a senior policy analyst with the C.D. Howe Institute, said whatever the Liberals do with EI needs to consider racialized workers, who are affected the most by the economic and health effects of the pandemic and often can't qualify for EI.

Part-time gains have outpaced full-time work in each of the past three months, Statistics Canada noted, with 345,000 more positions in July compared to an increase in full-time jobs of 73,000. Statistics Canada said nearly 30 per cent of people working less than 30 hours a week in July would have preferred full-time work, an increase from the 22.2 per cent recorded one year earlier.

Part-time work was within five per cent of its pre-COVID-19 levels last month compared with full-time work, which is still down 7.5 per cent from February before the pandemic struck.

The pace at which women gained back jobs moved faster than men in July, with about 275,000 jobs compared with 144,000 for men, but women remain further behind since the start of the pandemic.

Similar effects could be seen for low-income workers, who were at 85.4 per cent of levels recorded in February compared to 97.4 per cent for all other paid employees. Youth employment was still 17.4 per cent below pre-pandemic levels even as jobs increased by 135,000, driven mainly by gains for young women.

Nationally, about 266,0000 more people were looking for work in July as temporary layoffs declined, marking the third consecutive month of gains, but still down almost 300,000 from where it was in February.

Statistics Canada said the unemployment rate would have been 13.8 per cent in July if it had included in calculations those who wanted to work but didn't look for a job.

– With files from the Canadian Press