About one in 12 Manitoba jobs disappeared during the first two months of the COVID-19 pandemic, according to Statistics Canada’s latest monthly survey of Canadian employment.
Unemployment in Manitoba rose from 5.2 per cent in February, before a series of escalating closures went into effect in Manitoba, to 11.4 per cent in April, Statistics Canada said Thursday. That works out to 37,200 more unemployed Manitobans.
The actual job loss figure is worse, because many Manitobans left the labour force altogether, either because their industries aren’t operating right now or because they have to stay home to care for parents or kids.
The labour force declined by 48,900 people between February and April, Statistics Canada said.
The total job losses work out to 84,900 people out of a labour force of 1,046,000 working-age Manitobans.
Statistics Canada surveyed 56,000 Canadians about their employment status. The unemployed and labour-force numbers for Manitoba don’t align perfectly with job losses due to the nature of the data collection.
The restaurant, hotel and retail sector made up the bulk of the job losses in Manitoba. Together, the sales and hospitality industries accounted for 43.5 per cent of Manitoba job losses over the past two months.
This means many of the people earning the lowest wages in the province were among the hardest hit by the pandemic.
Health care and social assistance accounted for 17.1 per cent of the losses in Manitoba, mainly because dental clinics, physiotherapists and other non-urgent medical clinics shut down during the early weeks of the pandemic.
Younger Manitobans absorbed the brunt of the job losses. People age 15 to 24 accounted for 35.3 per cent of the Manitobans who lost their jobs.
Women were also hit harder than men. Fifty-six per cent of the Manitobans who lost their jobs between February and April were women, while 44 per cent were men.
The disproportionate impact on young women in the service industry reflects the demographics of the Manitobans who work in retail stores, hotels and restaurants.
“I live kind of paycheque to paycheque, so I wasn’t sure how I was going to keep up with the rent,” said Clarice Nguyen, a 23-year-old Winnipeg server.
She hasn’t worked since the middle of March, when both of the restaurants that employ her part-time — Forth on McDermot Avenue and Close Co. on Stafford Avenue — closed their doors due to the pandemic.
Like most Canadian provinces, Manitoba ordered restaurants to stop serving customers indoors as part of a broad range of public health orders aimed at slowing the spread of the virus that causes COVID-19.
Many Manitoba restaurants closed their doors before the province ordered them to shut down on April 1, as physical distancing made it impossible to operate and turn a profit.
“It kind of feels like my job is obsolete now, like it’s the, kind of the least priority and the highest risk to come back to,” Nguyen said.
The removal of thousands of young adults from the Manitoba workforce has an outsized impact on the provincial economy, in spite of their relatively low wages, said Fletcher Baragar, a University of Manitoba economist.
“That group in the economy is essentially a high-spending group. They’re basically living paycheque to paycheque, so they have high propensities to spend,” he said.
“That’s not really a group that’s going to be saving an average or even above average share of their paycheque,” he said.
The removal of younger workers has negative spinoffs for many other businesses, he said.
“So you’ll have that ripple effect go through. That’s really taking spending power directly right out of the heart of the economy.”
Before the pandemic, Nguyen was saving maybe five or 10 per cent of every paycheque, she said. Now, even with the assistance of the Canada Emergency Response Benefit, all of her income is going toward rent and groceries.
The loss of work is also making some young adults reconsider higher education.
Maura Fournier, 22, who was laid off from her job at Princess Street restaurant Clementine in March, hoped to enter law school or pursue a master’s degree in anthropology.
“I have to really think about paying for extended education,” said the Winnipegger. “I’m kind of worried it’ll be postponed and I’ll be entering a workforce that doesn’t exist, and it’s getting really existential and strange.”
Recent university graduates are also hurting, said Philip Cyrenne, a University of Winnipeg economist.
“The real tragedy, in some sense, is that these people who are looking for their first job are going to be delayed considerably,” he said.
The decimation of the restaurant industry is not just removing young adults from the workfoce and delaying their careers.
The restaurant industry shutdown has already hammered food production and distribution, Cyrenne said.
For example, a growing glut of potatoes is partly due to the consumer preference for French fries in restaurants, rather than operating deep-fryers at home.
Manitoba commercial fishers and pork producers are hurting from the evaporation of the U.S. export market, as well as because of restaurant closures.
“I think people underestimated how much demand comes from those sectors,” said Cyrenne, referring to the restaurant and hospitality industry.
On the plus side, Cyrenne said the service sector could be the first to rebound in Manitoba, which allowed retail stores to reopen on May 4.
On the downside, there is a lag between the initial job losses in the service sector and the effect those losses have on other sectors of the economy, such as manufacturing.
“I think it could be a bit of rough time for manufacturers in Manitoba and elsewhere for the short term,” Cyrenne said.
This is mainly because retailers of all sorts have been sitting on inventories for a month. Factor in reduced spending during a slow economic recovery and manufacturers will soon feel the pinch.
“If sales and spending is taking a pretty serious hit and if that’s expected to last for a considerable period of time — I’m looking at maybe at least three to six months — then wholesalers are going to start cancelling orders because they’ve got inventories that they can’t move,” Baragar said.
“As they start cancelling orders, that’s where the effect sort of moves back through the supply chain, and that’s what’s going to affect the manufacturers and the transportation sector.”
Baragar expects an economic trough for “a considerable period,” with no prospect of a real recovery until it’s clear COVID-19 can be managed as an ongoing threat.
“Even under a somewhat best-case scenario health wise, it’s going to take a while for the employment, spending and mass production numbers to jump up,” he said.
“I think that the sharp decline, we’re probably pretty close to the maybe the end of that phase, but that’s not the same thing as climbing out of the trough.”
There are more long-term storm clouds on the horizon. International trade faces obstacles, especially with China, and that could force agricultural producers to find new markets, Cyrenne said.
Ongoing travel restrictions also do not bode well for Manitoba’s aerospace industry, he said.
The end of leisure travel, at least for now, is also depressing out-of-work young adults in need of something to look forward to.
“Travel, which you learn a lot from, has been postponed, along with plans to move forward with your life,” said Fournier.
“You kind of just feel a bit like you’re stagnant, and even if you’re privileged and in a great position and you’re receiving funding, it still kind of feels temporary and so does your position in this society.”
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