Statistics Canada said on Friday that the Canadian economy lost 30,600 jobs in July.
It’s the second consecutive month of job losses, following the 43,000 job losses in June. Economists had expected the economy to post a slight gain of about 15,000 jobs, but instead the employment pool shrank.
Goods-producing industries actually added about 23,000 jobs during the month, but this relative strength was offset by a massive loss of 53,000 jobs in the service sector.
The healthcare sector has been a major drag, losing 22,000 jobs. After more than two years of caring for Canadians during the pandemic, burnout and job volatility in the sector have become a major problem. More than 10 percent of all nurses called patients at least once during the month, the data agency said, and more than 20 percent worked overtime to make up for it.
Statistics Canada said nursing vacancies in early 2022 were more than triple what they were five years ago.
“The drop in jobs in healthcare hasn’t gone unnoticed, because it was due to voluntary resignations rather than layoffs,” said economist Tu Nguyen of RSM Canada, an accounting and consulting firm.
“The displacement of burnt healthcare workers has led to an increase in the temporary closure of emergency rooms. This has far and wide repercussions, [because] When people are not taken care of, it results in workers in all industries releasing the sick, having to take time off to care for sick family members, or even exiting the workforce in harsher conditions.”
Despite the decline, the unemployment rate held steady at a record low of 4.9 percent, because while there were fewer jobs, there were fewer people looking for work as well.
As of the end of July, the data agency says there are about 1 million people in Canada officially classified as unemployed, meaning they want a job but don’t have one. Another 426,000 people wanted a job but did not look for a job during the month, so they were not officially counted among the ranks of the unemployed.
Compares 1 million unemployed people with 19.5 million Canadians who worked for wages during the month.
Canada’s weak labor market stands in stark contrast to that of the United States, where the economy added 528,000 jobs last month. This is double what economists had expected.
While the monthly job number is always volatile, and is especially so in the summer months, Thiago Figueiredo, economist at Desjardins, says the disappointing figure indicates that “the Canadian labor market slammed the brakes in July”.
“However, the labor market remains tight and there is scope for further employment weakness as economic growth slows.”
While the economy has fewer workers today than it did in May, many sectors and employers report employment remains strong. The tourism sector may have been hit more than any other by the pandemic, but as demand returns, so does the need for workers.
Laura Pallotta, vice president of Marriott Hotels, says the chain is currently trying to hire up to 1,000 people across the country, even as the overall economic situation grows bleaker.
“We think we need to continue to assign jobs and background roles [because] “We see that the demand for Canada in the coming years will continue to be strong,” she told CBC News in an interview.
Arvin Nagules, senior vice president at Menzies Aviation, which provides a variety of airport services across Canada and beyond, says his industry is also trying to raise staffing levels quickly.
He says airlines and airports have done hiring in the past two or three months as they have usually done in a number of years. “It’s not just the airline industry,” he said in an interview. “Everyone is fighting for the same group of people.”