CIBC: Long-term unemployment in Canada worse than during GFC

CIBC: Long-term unemployment in Canada worse than during GFC

CIBC: Long-term unemployment in Canada worse than during GFC

The proportion of Canadians suffering through long-term unemployment has reached a level not seen in several decades, according to the Canadian Imperial Bank of Commerce.

In a report released last week, CIBC said that the number of Canadians counted as long-term unemployed went up by approximately 151,000 in October. This came in the wake of the already sharp increase of around 79,000 in September.

“The total of almost 450,000 long-term unemployed Canadians, or those out of work for more than 27 weeks, has now surpassed the peak of the 2008-09 recession,” CIBC said in its report. “While it remains below the peaks of prior recessions, it does seem to be rising at a much faster pace than during those periods and could eclipse those levels in the months to come”

The impact of this labour market lethargy was somewhat offset by the addition of 84,000 new jobs in October, pushing the unemployment rate slightly down to 8.9%.

Most of the gains were seen in the retail/wholesale sector, where 45,000 were created, and professional, scientific, and technical services, which saw an increase in employment of 42,000.

“These are sectors that would not have been affected by the public health restrictions imposed in October,” CIBC said. “While a resumption in retail hiring still left employment more than 5% below pre-COVID levels, wholesale employment has now eclipsed levels seen in February. The same can be said of professional, scientific and technical services jobs and educational employment, the latter likely reflecting the increased needs for staff in school systems operating under COVID protocols.”

Conversely, renewed lockdowns led to accommodation and food services suffering a loss of approximately 48,000 jobs in October.