May Labour Force Survey Preview: Is The Worst Behind Us?
Numbers might miss some of the potential bounce-back from reopening.
The most we can say about the May Labour Force Survey (LFS) numbers is that it’s unlikely they’ll be as dramatic as the back-to-back record declines of March and April.
Employer hiring appetite looks to have stabilized after deteriorating sharply between mid-March and mid-April. Total Canadian job postings on Indeed inched up in mid-May compared to last year’s trend, aided by a partial rebound in new job postings, with further progress later in the month. Other recent indicators like small business sentiment and online survey results of Canadians, also remain subdued, but aren’t in as bad a shape as last month.
Whether these developments mean April’s LFS numbers were in fact the bottom could be a question of timing: Friday’s figures will reflect employment conditions between May 10th and 16th, which might be too early to capture the potential effects of the gradual re-opening of certain workplaces happening across the country. Meanwhile, at least layoffs and reduced work-weeks have continued past the end of the April LFS reference week, with an additional 1.25 million Canadians applying for emergency benefits between April 19th and May 14th.
Another source of uncertainty is what happens to Canadians who were employed according to the April LFS, but didn’t work during the week likely due to COVID-related reasons, the ranks of whom have jumped by nearly 2.1 million since February. Some of these workers might be among the first to be recalled, which won’t boost headline employment, while others might lose their jobs entirely. Both cases highlight the importance of tracking metrics like total hours worked to assess how conditions are changing.
Lastly, observers will be paying close attention to how different industries and occupations across the economy are evolving. Lower-paying jobs were the first to get hit in March, then joined by massive job losses among mid-paying occupations in April. Meanwhile, higher-paying roles have held up relatively well. How these different areas of the labour market fare alongside the headline numbers will be crucial in assessing where the labour market is heading as we transition to the next stage of the public health crisis.
Brendon Bernard is an Economist at the Indeed Hiring Lab, focusing on the Canadian labour market. His research interests include analyzing how detailed trends in the job market fit in with broader developments in the Canadian economy. Brendon was previously an economist with Department of Finance Canada, where he focused on analyzing Canadian financial sector policy and the U.S. economy. He holds a Master’s in Economics from the Vancouver School of Economics at University of British Columbia, as well as a Bachelor of Arts (Honours) from Queen’s University.