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Excellent data from the Canadian labour market: 303,000 jobs were added in March and unemployment was falling

Statistics Canada has just released data for March. They show that employment in the economy increased in March and 303,000 new jobs were created. It also includes employment growth in the sectors of the economy most affected by health-related restrictions.

In retail, nearly 95,000 jobs were added throughout the month, which fully beat the industry above the losses recorded in January due to lockdowns.

Surprisingly, also in the accommodation and food services sectors, there was a significant increase in employment, with 21,000 jobs added in March. According to Statistics Canada, the sector will be the hardest to return to full recovery of all sectors of the economy, with current employment levels down 24.4% or offering 298,000 fewer jobs compared to the pre-pandemic period.

There were also significant increases in employment in the health sector, construction and educational services. That last gain was partially a result of Ontario, which has overall led the way in job growth. An important factor was moving its March break for schools to the following week to slow the spread of Covid-19.

Domestic employment data released on Friday morning exceeded February’s 259,000 employment growth, which in turn exceeded earlier expectations, beating the previous period.

March growth pushed employment in Canada to 296,000 jobs, or 1.5% less comparing to the pre-pandemic time of February 2020.

Thus, the overall unemployment rate fell to 7.5% in February from 8.2%, the lowest level in the entire pandemic period.

According to TD senior economist Sri Thanabalasingam, the Canadian labor market saw another increase after February, thanks to recent decisions to ease the restrictions on Covid-19. According to him, recent statistics have brought employment very close to pre-pandemic levels. The next few months, on the other hand, may prove to be a challenge for the Canadian labor market.

There has also been a hint of concern under the stunning employment figures at this month’s renewed lockdowns in the wake of the third wave of the pandemic. Sectors that saw gains in March may face losses this month.

CIBC senior economist Royce Mendes confirmed that most of the recruitment in the past few months has happened in the sectors most affected by shutdowns. He also believes that stricter public health regulations have now been re-enforced to contain the spread of the virus in many parts of the country, there is reason to believe that at least some of this progress will be reversed in the near future.

Employment figures came just over a week before releasing a budget by the Liberals. They are expected to be used as a measure of planned stimulus measures.

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