September’s national construction unemployment rate continues decline, even as labour force numbers inch lower


Labour Market Corner Blog

The good news is that Canada’s national construction unemployment rate continued its fifth straight month of decline in September, although the industry should take note of small contractions in both the labour force and total employment numbers.

The most recent Statistics Canada Labour Force Survey, reflecting labour market conditions for the week of September 13th to September 19th, reported a further decline in unemployment from 7.3% in August to 6.4% in September. This decline in construction unemployment maintains the downward trend that started in May with the lifting of provincial employment restrictions enacted to combat the spread of COVID-19. At this point, while unemployment rates remain 2.3 percentage points higher than those recorded in September 2019, the construction recovery continues to outpace that of most other sectors and that of the national economy, which reported an overall unemployment rate of 9% in September.

Drilling down, however, total construction employment reversed its August gains, dropping by 0.5%, which is 7.4% below September 2019 employment levels. The construction labour force also reported a slight decline of -1.4% (-22,100 workers) in September – although it’s unclear whether that decline represents workers pursuing opportunities in other industries, or voluntarily withdrawing from the labour force. The size of the construction labour force remains approximately 5% below September 2019 levels.

Graph: Construction industry labour force, employment and unemployment rate (%), Canada
Provincial numbers tell their own stories as the interplay between unemployment rates and employment totals continues across the regions.
The unemployment rate in Quebec was unchanged from August, while Manitoba and British Columbia experienced marginal increases in rates (<1%). Newfoundland and Labrador continued to make up ground, leading the rest of the country as it took back 5 percentage points from its August unemployment rate. However, the unemployment rate in the province remains approximately 5 percentage points higher than this time last year.   
Newfoundland and Labrador also outpaced the country in month-over-month employment gains at 12.1%, with Nova Scotia following at 4.3%. Manitoba, Ontario, and Quebec reported more modest gains of between 1 and 2%. The remaining provinces experienced slight to moderate employment declines, most notably in British Columbia (-7.8%) and New Brunswick (-5.3%).  
Year over year, the largest employment declines were reported in Newfoundland and Labrador (-21%) and British Columbia (-14%).
The number of hours worked in September declined in New Brunswick (-7%), Prince Edward Island (-4%), and British Columbia (-3%). Newfoundland and Labrador led gains with a 41% increase in hours; more modest gains were experienced in the remainder of Canada. Nationally, total hours worked remain below September 2019 levels, with only Prince Edward Island experiencing near-total recovery.
Even as some provinces contemplate further quarantine and lockdown measures in October, greater understanding of the nature of the pandemic by both policymakers and construction employers and greater confidence on the part of workers regarding COVID-19 health and safety measures should see numbers less affected by uncertainty as winter approaches.
Meanwhile, the industry should continue its efforts to promote both recruitment and apprenticeships, even through pandemic recovery, to address underlying fluctuations in the size of the labour force.
Bob Collins
Bob Collins is BuildForce Canada's Chief Economist.