COVID-19 Economic Recovery Tracker

Every facet of life has been changed by the pandemic, from how we live, to how we work. What impacts has COVID-19 had on Halifax's economy? Find the latest economic data and analysis here.

How is Halifax’s Economy Changing?

COVID-19 has brought a sea change and created new economic conditions across the globe and here in Halifax. This Tracker examines the economic toll of the pandemic, Halifax's pace of recovery, and our resilience in the face of ongoing COVID developments. There may be lingering effects of the pandemic and more economic uncertainty as we recover from COVID cases across the country.

Perhaps the most important factor affecting Halifax and its economy is the current state of public health. The Province of Nova Scotia has created a new dashboard on case counts relating to COVID-19. Statistics Canada also produces a dashboard of the effects of COVID-19. This shows a broader, national picture of how COVID is affecting the economy and how Canada is recovering.

Employment

COVID-19 has had an immense effect on Halifax’s labour market and employment figures. Although the effects are different across industries, overall our economy saw a massive 10% loss in total employment and a third of its potential workers underutilized at its lowest point. Young people and those approaching retirement are among the groups most negatively impacted and female employees have been more impacted than male employees. While economic recovery has been rapid, the increases in COVID cases in November 2020, April 2021, September 2021, and December 2021 have led to economic restrictions. As the city manages its recovery, we will provide analysis and commentary on how these changes affect the economy.

  • Source: Statistics Canada, Labour Force Survey, Table 14-10-0378-01

    Cumulative Change in Employment Since January 2020

    Why is this important?

    This chart looks at the cumulative monthly change in the number of employed workers in Halifax since January 2020 (pre-COVID restrictions). Tracking changes in total employment provides a broad overview of the effects that COVID-19 has had on people in our city.

    How is Halifax doing?

    Between January and May 2020, employment in Halifax dropped by 23,200 workers, a massive 10% loss in total employment. Halifax’s total employment rebounded by 29,400 workers between May 2020 and March 2021, but a third wave of COVID cases threw cold water on this economic revival.

    Overall employment has climbed by 1,500 positions since the start of 2022, a total of 10,000 positions above its pre-pandemic level (up 4.3%). Employment had been on the decline through the early months of 2022, but has rallied in April, jumping up 3,200 positions in one month.

    What are we watching for?

    Halifax has seen a rapid pace of recovery since its low point in May 2020, despite disruptions. The relatively small impact on the economy was likely a function of the quick response from the community and public health officials in getting these waves of COVID cases under control. Nova Scotia demonstrated that if it can get a handle on the public health situation, economic recovery is not far behind. We will continue to track the situation as it unfolds, looking especially at how different sectors of the economy are affected. The Industries section below explores these changes in more detail.


  • Source: Statistics Canada, Labour Force Survey, Table 14-10-0378-01

    Cumulative Change in Employment Since January 2020 by Age Group

    Why is this important?

    Tracking employment by age group shows us how different cohorts are being affected by COVID. If a specific group is particularly worse off due to COVID, or slow to recover, we should monitor it carefully.

    How is Halifax doing?

    Despite representing only 12% of the workforce, youth workers (ages 15-24) accounted for 49% of all layoffs during the initial outbreak (January to May 2020). This over-representation of youth is likely due to retail stores and restaurants shutting their doors. Youth employment struggled through the third wave and is only now showing signs of recovery. Since August 2021, employment dropped by 3,400 positions by the end of the year, and has only rebounded by 2,200 jobs by April 2022. Youth employment is well below its pre-pandemic level (down 6.9%) but has improved over the past 12 months (up 7.0%).

    Employment for all other age groups has increased above pre-pandemic levels. Those ages 25 to 54 are up 6.9% since January 2020, but have actually fallen by 2,000 positions since January 2022. Those approaching retirement (ages 55 to 64) are up 2.9% since the start of the pandemic and have seen 900 more positions filled since January 2022. Employment over the age of 65 is currently up 13.1% since the pandemic began and has increased 1,000 positions since January this year.

    What are we watching for?

    The start of 2022 was not a good sign for economic recovery, but job numbers jumped up in April. While total employment has climbed, youth employment is still behind where it was prior to the pandemic. We will continue keeping a close eye on specific age groups and their differences from the larger picture.


  • Source: Statistics Canada, Labour Force Survey, Table 14-10-0378-01

    Employment by Sex

    Why is this important?

    By delineating changes in employment by sex, we can get a sense of how COVID layoffs are affecting men and women differently. Women face higher levels of job insecurity in Canada, are more likely to work part-time jobs than men, are more likely to be employed in lower-wage positions, and remain vastly underrepresented in leadership positions (read more).

    How is Halifax doing?

    Not only do women remain underrepresented in Halifax’s labour force, COVID-related layoffs and reductions in working hours have impacted more female employees than male employees. Between January and May 2020 (the deepest month of layoffs), male employment dropped by 9,500 workers while female employment dropped by 13,700 workers. By March 2021, employment had recovered for both groups, up 2.0% for males and 3.4% for females above their pre-pandemic levels. Both groups experienced job losses in the most recent wave of COVID-19 cases, seeing a gradual decline in employment in recent months. Since the start of 2022, female employment has decreased by 600 positions and male employment has increased by 2,200 positions into April 2022.

    What are we watching for?

    Women continue to face systemic barriers to labour force participation. Given the disproportionate effects that COVID layoffs have had on female employees, special attention ought to be paid to known barriers such as the availability and cost of child care. These factors may affect the resiliency of female employment in the face of future crises and as we see more COVID cases, these differences may be exacerbated.


  • Source: Statistics Canada, Labour Force Survey, Supplementary Indicators - Custom Tabulation

    Labour Underutilization Rate

    Why is this important?

    The labour underutilization rate provides a nuanced picture of the labour impacts of the recession. It is a special measure that Statistics Canada is using to track COVID-19’s impact on employment. The rate combines the number of people who are not working but wish they were with the number of people who are working far fewer hours than usual, then compares these underutilized workers to the total number of employed and available workers (read more). This can help us understand how much the recession has affected employment in cases like COVID-19, where the unemployment rate provides an incomplete picture.

    How is Halifax doing?

    In 2019, before COVID restrictions, Canada’s labour underutilization rate averaged 11.7%. By the depth of the recession in April 2020 over one-third (37.6%) of Canada's labour force was underutilized. This rate decreased slowly and consistently each month until November 2020, where it reached 16.2%. Since then the underutilization rate in Canada has trended downward, despite temporary disruptions as waves of COVID cases have occurred across the country. However, none of these disruptions have approached the magnitude of the initial shock in March 2020. As of December 2021, the underutilization rate sits at 11.7% or roughly one in nine workers.

    The situation in Halifax has been similar, reaching an all-time high in April 2020 at 35.4%. Halifax and Nova Scotia didn't see the same peak in late 2020, quickly containing and recovering from a second wave of COVID-19. However, a third wave of cases in May 2021 caused the underutilization rate to spike upwards across the province. The provincial rate increased to 21.9%, while the rate in Halifax increased to 22.7%. The rates have trended downwards since then, currently sitting at 15.1% and 12.5%, respectively.

    What are we watching for?

    It is likely that we will see underutilization rates rising across the province in early 2022 in tandem with rising case counts. Afterwards, as more and more of the population is vaccinated and gets their boosters, these rates should continue to trend down towards normal. However, this process may take several months to play out as workers return to the workplaces, gain back their usual working hours, or find new employment. As the country continues to face challenges with its public health situation, underutilization will be higher than normal. Overall employment has grown, but the underutilization rate has been above normal, a sign that economic recovery is still a work in progress.


Industries

Coronavirus is significantly impacting most industries, though not equally. Tracking employment changes and sales by industry helps us broadly understand which sectors were most heavily impacted. Some industries - notably tourism and hospitality - are particularly hard hit and will recover more slowly than the economy as a whole.

Our partners at the Canadian Federation of Independent Business (CFIB) regularly consult and survey their member businesses. You can see the results of their surveying on business confidence and how businesses are responding to COVID-19.

  • Source: Statistics Canada, Labour Force Survey, Table 14-10-0379-01

    Cumulative Change in Employment Since January 2020 by Industry

    Why is this important?

    COVID restrictions have not not affected all industries equally. Tracking the changes in employment by industry helps us broadly understand which sectors were most heavily impacted by layoffs and how well they are recovering.

    How is Halifax doing?

    Accommodation and food services as well as wholesale and retail trade experienced the heaviest losses throughout the pandemic. By May 2020, these industries had lost 7,600 and 7,300 employees, respectively. Accommodation and food services had been slower to recover initially and experienced a sharp decline in employment after the increase in COVID cases in November 2020. The industry has experienced continued difficulties in recent months, falling 2,200 positions between its high-point in April 2021 and April 2022. Employment in wholesale and retail trade has seen some recovery following the third wave, reaching roughly 40,000 employees in November 2021. However it has declined in recent months, falling by 1,200 positions (-3.0%) between November 2021 and April 2022.

    Decreased employment may also reflect factors other than COVID-19, such as tighter labour markets, as employers in these industries experience difficulties attracting and retaining employees. Most other industries suffered fewer losses in total employment, with most industries losing fewer than 2,000 employees at their worst point. Both recovery and seasonal employment have affected growth and overall employment in April 2022 is roughly 4.3% above its January 2020 level.

    What are we watching for?

    Halifax is recovering with employment in many industries above their pre-COVID levels, but this must be observed with caution. Despite widespread vaccine distribution, upticks in COVID cases have caused severe disruptions in some industries. COVID cases have surged in the past few months and this will continue to have an adverse effect on employment. As we experienced during the first three waves, certain industries - such as retail or accommodation - have borne a disproportionate share of the losses. While most industries have settled into a new normal we should pay special attention to those industries that have not.


  • Source: Statistics Canada, Retail Trade Survey, Table 20-10-0008-01

    Retail Sales by NAICS Industry

    Why is this important?

    Retail sales are a useful barometer of economic activity, as they closely track how much consumers are buying overall. Retail sales can show whether consumers are confident enough in the economy to make major purchases and illuminate which kinds of products consumers are choosing to spend more of their money on. Detailed sales categories can show how disruptions may be affecting one industry over another.

    How is Halifax doing?

    While detailed data are not available for Halifax, we can examine how Nova Scotia’s retail sales are doing to provide insight into Halifax’s economic health. Retail sales have been turbulent since the start of 2021. There have been four monthly shifts of more than 15%, with positive shifts in March and June, and negative shifts in January 2021 and January 2022. Aggregate sales have risen 2% since January 2021 and are up 9% since prior to the pandemic (January 2020). However, January 2022 saw declines across all sales categories and aggregate sales dropping by 25% since the previous month, only recovering by 2% in February. Since January 2021, the largest declines were from building materials dealers (-11%), sporting goods stores (-9%), and food and beverages stores (-3%). These figures were impacted by a combination of seasonal factors, elevated COVID-19 case counts, and rising prices.

    While aggregate sales were up from 2021, this number combines the impacts of sales volumes and prices. Nova Scotia's inflation rate from January 2021 to January 2022 was 4.9%, while overall sales were flat during the same period. This suggests that the volume of sales actually decreased during that time.

    What are we watching for?

    Monthly data for January 2022 shows a significant drop in retail sales, larger than the seasonal drop experienced in January 2021. Inflation has become much more of a factor than it has been in previous years. Importantly, the effects of inflation, COVID-19 case counts, and even seasonal variance are not felt equally across industries. If an industry has been especially hard hit or is slow to recover, it may need special attention. The fast pace of recovery in early 2021 far exceeded expectations and is a positive sign for overall economic progress. However, the prospect of inflation could erode many of the benefits of recovery. It will be important to understand the pace of recovery and how different industries respond to recovery efforts and changing prices.


Debt

Debt is an important economic indicator to measure how families and businesses are handling the downturn. Surprisingly, we haven't seen the debt-related issues we might have expected from an economic downturn. Business and consumer insolvencies in Halifax have been low throughout the pandemic, lower than comparable metrics for 2019.

Government support programs have also played a role in household debt. These supports can mitigate how much debt consumers take on, but are also temporary. As these programs wind down, the debt and insolvency situation may change and it is important to continue tracking the situation.

  • Non-Mortgage Consumer Debt Statistics

    Why is this important?

    Debt is a measure of how much individuals are spending above and beyond what they receive in income. If individuals lose their jobs due to COVID, their incomes decrease and they must take on more debt or reduce their spending. While some level of debt is actually a good sign in a healthy economy, we should be concerned if household debt begins to rise suddenly or unexpectedly.

    How is Halifax doing?

    Indicators suggest that debt levels are continuing to drop, with non-mortgage debt at $20,916 per consumer in Q4 2021, down 3.21% since Q4 2020. Delinquency rates dropped precipitously in the middle of 2020, falling by nearly a third to 1.08% in Q3 2020. Since then they have remained low and were sitting at 0.93% by the end of 2021. This means that fewer consumers are being overwhelmed by debt. With debt and delinquency remaining low, it may indicate consumers are spending less and adapting to lower incomes and higher consumer prices - saving money they would have otherwise spent on dining out or travel. It may also indicate that incomes are recovering quickly enough to avoid taking on more debt, or that government programs have supported household incomes through the crisis.

    What are we watching for?

    It is difficult to interpret why debt-loads have decreased in the face of a crisis. Without a clearer understanding of why this has happened we cannot say for certain that it is good news, but it is the absence of bad news. It will be important to watch this indicator moving forward to ensure that debt-loads remain low and do not rise suddenly or unexpectedly. These results show a promising trend.


  • Consumer Insolvencies by Type

    Why is this important?

    Consumer insolvencies show how many families have been unable to make payments on their debts. If families can endure a recession by taking on debt, it indicates they have been able to manage the impacts without lasting damage; their short-term costs fit within their long-term ability to pay. Insolvencies occur when the amount of debt they have taken on is overwhelming. Therefore, consumer insolvencies provide insight into how severely the COVID crisis has affected families, as well as if government support programs have been able to mitigate the long-term damage caused by the downturn.

    How is Halifax doing?

    Consumer insolvencies in Halifax have remained low throughout the pandemic. There were only 256 bankruptcies and insolvency proposals in Q1 2022, roughly half the average of 508 insolvencies per quarter between 2015 and 2019. While these data do not raise alarm bells, it is possible that the impacts of COVID on the economy and insolvencies could take a longer time to resolve.

    What are we watching for?

    The low number of insolvencies is a good sign and we have not seen a spike we might expect from an economic downturn. It is looking more likely that Halifax will be able to withstand the economic downturn and that the lasting, debt-related harms will be mitigated. However, it is still important to keep track of whether insolvencies increase as the economy continues to recover. We expect that insolvencies will inevitably rise and return to normal, but it is unclear when and how quickly this will happen. When insolvencies eventually rise, it will be important to see whether they trend towards normal or whether they overshoot historic norms, as this may be a sign of economic damages caused by the pandemic.


  • Business Insolvencies by Type

    Why is this important?

    Similar to consumer insolvencies, business insolvencies show how many businesses cannot make payments on their debts. If businesses can endure a recession by taking on debt, it indicates they have been able to manage the impacts with minimal lasting damage. When facing insolvency, businesses will often close, leading to layoffs and job losses. Therefore, insolvencies give us an idea of how much long-term damage a recession will cause.

    How is Halifax doing?

    Business insolvencies in Halifax remained low throughout the pandemic. There were only 6 business insolvencies in Q1 2022, below the average of 8.4 insolvencies per quarter since 2015. This is a good sign, but it is possible that the impacts of COVID on the economy and insolvencies could take a longer time to resolve.

    What are we watching for?

    The low number of insolvencies throughout the pandemic has been a sign of good economic health. This provides insight into how severely the COVID crisis has affected businesses and whether businesses have been able to access the credit and liquidity support they need to stay in business. Similar to consumer insolvencies, business insolvencies will have to rise eventually. We are continuing to watch these metrics to see if they slowly rise towards a more typical level, or if there are unforeseen economic damages that cause them to overshoot historic norms.


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