Canadian Unemployment Rate Rises in January

Statistics Canada (StatsCan) reported today (2-4-22) that Canadian employment fell by 200,000 (-1.0%) in January, and the unemployment rate increased 0.5 percentage points to 6.5%. The total number of unemployed people increased by 106,000 (+8.6%) to 1.34 million. This marks the first increase in the unemployment rate in nine months, or since the start of the third wave of the COVID-19 pandemic in April 2021.

All of the decline in January was among private sector employees (-206,000; -1.6%), reflecting large losses in the accommodation and food services and information, culture, and recreation industries. Following the decline, the number of employees in the private sector was essentially the same as in February 2020.

The number of public sector employees held steady in January and remained above its pre-pandemic February 2020 level (+305,000; +7.8%). Self-employment was little changed in January, the sixth consecutive month with no growth, and remained 7.9% (-227,000) below its February 2020 level.

The report notes that absences from work due to illness or disability — that is, for any short- or long-term health-related reason — tend to follow a seasonal pattern, and typically peak in the winter. However, as the Omicron variant of COVID-19 spread across the country, absences due to illness or disability reached record highs in January.