Greater Victoria's unemployment rate at highest level since 2001

The capital region’s unemployment rate rose to 11 per cent in June, as the pandemic continues to affect key local sectors such as hospitality and tourism.

That marks the highest level for the region since Statistics Canada began collecting comparable numbers in 2001. May’s unemployment rate was 10.1 percent.

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The number of people employed in the capital region dipped in June to 178,400 from 179,200 in May, the federal agency said in its monthly labour report. Provincially, the unemployment rate moved to 13 per cent last month from 13.4 per cent in May.

Across the country, nearly one million jobs were added to the economy, bringing the unemployment rate down to 12.3 per cent from 13.7 per cent.

B.C. Finance Minister Carole James said Friday she is cautiously optimistic, but British Columbians have a “long road ahead of us.”

Employment gains in May and June have seen the recovery of 40 per cent of the total jobs lost since February.

“While these numbers are encouraging, the road ahead is a challenging one, as total job losses since the start of the COVID-19 pandemic remain at 235,000,” James said.

B.C.’s one-time $1,000 emergency benefit for workers has been distributed to more than 600,000 individuals, she said.

James said women are more likely to have lost their jobs due to COVID-19 than men, and youth unemployment remains high at 29 per cent.

But the “significant” number of youth who entered the labour force in June is a sign of growing confidence that people can return to work safely, she said, noting 45,000 young people found jobs in B.C. in June.

While the services sector has shown the largest number of job losses, the accommodation and food services sector represents 50 per cent of June’s job gains, she said.

James plans to deliver an update on B.C. finances on Tuesday, outlining what’s been spent to support individuals and businesses, and updating revenue and deficit forecasts.

Jock Finlayson, the Business Council of B.C.’s chief policy officer, said it’s encouraging to see job gains in the past two months — reflecting the reopening plan and a gradual return to business.

However, an overwhelming number of jobs gains are in part-time work, with “very few full-time jobs,” which reflects the underlying softness of the economy, he said.

“What we are most concerned about is we actually think there is going to be additional waves of layoffs coming in the province over the coming months,” said Finlayson, who expects an increase in insolvencies in the next two to three months. It’s a trend that has already been seen in the U.S., where large retailers have announced they are shutting down.

As B.C. businesses reopen and figure out what the “new normal” will be, some will not be viable due to factors such as changes in consumer behaviour, additional costs, an increase in online shopping, and limitations on large gatherings and conventions, Finlayson said. Sectors such as travel and tourism will be slow to come back and businesses such as restaurants face restrictions on the number of people who can be served.

The global recession is hitting B.C.’s export industries, he said, pointing to the loss of manufacturing jobs last month.

The council is predicting a 10 per cent decline in the number of businesses in B.C. by the end of next year.

Finlayson welcomed job gains, but said “we are not out of the woods” yet.

With most businesses now operating again, employment gains over the summer will be more modest than the ones in June, he said.

Finlayson anticipates that the economic and fiscal update from James next week will be “pretty sobering,” but not as severe as the federal one, which forecast a deficit of more than $343 billion.

Nationally, a total of 953,000 jobs were gained last month, split between full-time and part-time work, Statistics Canada said.

Two successive months of job increases means that employment across Canada is at 1.8 million, down by 9.2 per cent from February, before the pandemic hit the economy. About 2.5 million Canadians were unemployed last month, the agency said.

Brian DePratto, Senior Economist with TD Economics, said that the pace of any future gains is unknown. “There is the risk that what we’ve seen so far has been the ‘low-hanging fruit’ as operations that are able to safely re-open have done so.”

Statistics Canada reported that although the unemployment rate for all major demographics groups fell in June, it remained slightly higher for women, at 12.7 per cent, than for men at 12.1 per cent.

The virus-related economic shutdown resulted in an increase in the number of people who wanted to work, but were not categorized as unemployed because they were not looking for work, likely because they didn’t think they would be hired, the agency said. But May and June have brought an increase in job-hunters, as pandemic restrictions began to ease, it said.

cjwilson@timescolonist.com

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