Hundreds of thousands of Canadians are waiting for jobs in business, personal and transportation services industries to return, writes Philip Cross in the Financial Post. Below is an excerpt from the article which can be read in full here.
By Philip Cross, August 31, 2020
Last week, StatsCan announced retail sales in June had completely recovered all their losses from the height of the pandemic. Some commentators incorrectly interpreted this as a sign the broader economy was on track for a V-shaped recovery from recession, with rapid growth quickly offsetting spring’s steep declines. If only that were true! The rebound of retail sales is mainly symptomatic of how some sectors of the economy have been able to adapt to the new protocols on social distancing. But any personal and business services that involve close personal contact or crowding in public spaces continue to struggle, exerting a significant drag on the overall recovery.
At the worst of the pandemic in April, three million jobs disappeared. By July, nearly half these losses had been recouped. Examining how different industries have rebounded gives a clearer picture of where the recovery is proceeding well and where it is faltering.
Job losses were minimal and quickly made up in the natural resources sector and finance and real estate, which were able to adapt to social distancing relatively easily. Losses in government also were few, outside of education, where further declines may be coming as the impact on universities of having many fewer foreign students begins to be felt this fall.
Construction, manufacturing, and wholesale and retail trade all initially suffered large losses in employment but together have recovered more than half their COVID-related losses with three straight monthly gains. All three quickly found ways to operate while respecting social distancing. This leaves them on track for a V-shaped recovery, even if weak demand continues to hamper certain industries, such as clothing and aerospace manufacturing.
On the other hand, a broad range of personal and business services are struggling to find their footing in the new post-COVID world. In absolute terms, the largest decline between February and July was in accommodation and food. This reflected severe losses for bars and full-service restaurants, as well as hotels that depend on foreign visitors. Sharp declines also occurred in personal, recreational and cultural services, including everything from hairstyling to spectator sports and concerts. Recovery in these industries may be even weaker than for restaurants. A StatsCan survey found twice as many Canadians are concerned about the health risks associated with attending shows, festivals, movies or sporting events than with going to restaurants or bars. Of the 1.6 million jobs that disappeared and have not yet come back, one-third were in these three services industries.
***TO READ THE FULL ARTICLE, VISIT THE FINANCIAL POST HERE***