Ontario's Job Market Results for March 2020 and the COVID-19 Pandemic

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As a result of the sharp job loss, Ontario’s unemployment rate jumped to 7.6 per cent in March, up from 5.5 per cent in February. The 2.1 percentage point jump in the unemployment rate was the largest single-month increase on record, bringing the jobless rate to its highest point since December 2013. The rise in the unemployment rate in March would have been even higher if many laid-off workers had not decided to give up looking for work.[2]

Both full-time (-249,000) and part-time (-154,000) employment declined sharply in March. Almost 80 per cent of the job losses occurred in the private sector (-320,000), while self-employment (-40,000) and public sector employment (-44,000) also declined.

Impact of the COVID-19 Pandemic on Employment

The dramatic deterioration in Ontario’s labour market in March reflects the impact of the COVID-19 pandemic which resulted in a broad, mandated shutdown of non-essential activity throughout the province beginning in mid-March and extending through April.[3] However, the labour market results in March stand in contrast to previous periods of sharp job losses. During past recessionary periods, significant declines in household spending, foreign exports and investment forced businesses to reduce production and employment. In the current downturn, businesses were directed to temporarily close their operations, forcing some of them to lay off employees.

The FAO estimates that about 1.2 million workers - representing nearly one in six jobs across the province - were directly affected by the shutdowns, through either job losses, temporary layoffs or sharply reduced hours. In addition to the net decline in employment of 403,000, the FAO estimates that nearly 500,000 more employees had essentially no hours worked, while a further 300,000 others worked less than half their usual hours during the reference week[4], largely due to COVID-19 related reasons.

Workers in public-facing roles were severely impacted by the crisis in March, with sharp job losses in accommodation and food services (-119,600 jobs or -26.7 per cent), wholesale and retail trade (-87,600 jobs, or -7.9 per cent) and information, culture and recreation (-30,200, or -9.8 per cent).

Vulnerable workers were particularly hard hit by pandemic-related shutdowns. Temporary workers experienced job losses at a much higher rate (-14.0 per cent) compared to permanent employees (-5.6 per cent).[5] For young workers (ages 15-24), many of whom are employed in temporary or part-time positions, employment dropped sharply by 158,800 jobs (or -15.8 per cent).

Part-time workers (-11.3 per cent) lost jobs at nearly three times the pace of full-time workers (-4.0 per cent). Female part-time workers were also more affected by the job losses in March, with employment down 109,100 (or -12.4 per cent).

With the Province mandating closures of non-essential activities starting in mid-March, the total number of hours worked in Ontario dropped dramatically, falling 13.1 per cent in March compared to a year earlier, and marking the lowest number of hours worked since late 2009.

Almost all the increase in unemployment was driven by temporary layoffs in March. The number of unemployed individuals on temporary layoffs increased eight times in March from a year earlier, the highest on record since 1976.

Table 1: Key Employment Indicators in Ontario

Almost All Industry Sectors Experienced Job Losses in March

Almost all major industry groups experienced lower employment in March. Job losses were particularly large in public-facing industries, including accommodation and food services (-119,600, or -26.7%), wholesale and retail trade (-87,600, or -7.9%), information, culture and recreation services (-30,200, or -9.8 per cent) and healthcare and social assistance (-56,100, or -6.1%).

Industries that are more likely to be able to support employees working from home experienced more modest employment declines in March, including professional and scientific services (-2,300), public administration (-3,300) and finance, insurance and real estate (-6,200).   

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All Provinces Experienced Labour Market Weakness

Nationally, Canadian employment dropped by 1 million workers (-5.3 per cent) in March, a record monthly job loss. The national unemployment rate rose sharply to 7.8 per cent, up from 5.6 per cent in February. All provinces experienced significant labour market impacts from the COVID-19 crisis in March, with Quebec (-6.0 per cent) and British Columbia (-5.2 per cent) posting large employment declines and sharp increases in unemployment rates.

Chart 3: Unemployment rate increased in almost all the provinces

Source: Statistics Canada.

Source: Ontario.ca and FAO.

Snapshot of the Ontario Labour Market in March 2020

The infographic presents the following information:

1. About 1.2 million workers were directly affected by COVID-19 related shutdown
   1. 403,000 decline in Employment
   2. 800,000 more employees worked sharply fewer hours
2. Unemployment rate increased to 7.6 per cent in March, from 5.5. per cent in February
3. Total hours worked declined 13.1 per cent year-over-year in March