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, and September 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 last year, 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 5,100 positions since the start of 2021, a total of 9,700 positions above its pre-pandemic level (up 4.2%). Following the third wave, employment has continued to rebound in August, September, and October, rising by 5,200 jobs, 2,000 jobs, and 900 jobs respectively, over the previous month. However, results for November 2021 show a dip of 600 jobs.

    What are we watching for?

    Halifax has seen a rapid pace of recovery since its low point in May 2020, despite disruptions in November 2020 and April 2021. 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. The city 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, 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 April 2020, near the depth of the recession, over one-third (37.6%) of Canada's labour force was underutilized. This rate decreased slowly and consistently each month until November, where it reached a low of 16.2% and began to rise in the face of a second wave of COVID cases. Since then the underutilization rate in Canada remains elevated but stable. As of May 2021, it stands at 17.1% or roughly one in six workers.

    The situation in Halifax has been similar, reaching an all-time high in April 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%.

    What are we watching for?

    Due to data availability, we have been unable to see how the underutilization rate has responded to the recent increase in COVID-19 cases. As Nova Scotia has managed to keep its public health situation under control, it is likely that these rates have decreased since May. However, this process may take several months to play out as workers return to the workplace, gain back their usual working hours, or find new employment. As the country continues to face challenges with its public health situation, underutilization will remain 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.

  • 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 between January 2020 and May 2020. The over-representation of youth is likely due to retail stores and restaurants shutting their doors. Youth employment struggled through the third wave and has declined again in recent months, dropping by 3,000 jobs since August. Youth employment is well below its pre-pandemic level (down 11.7%) but has recovered since its recent trough in May (up 6.8%).

    Between January 2020 and November 2021, Halifax has seen recovery and growth for those ages 25 to 54 (up 8.3%) and those ages 55 to 64 (up 8.3%). November 2021 saw more jobs for those ages 55 to 64, but declines in most other groups. Employment over the age of 65 is currently down 1,300 jobs (down 13.1%) from its January 2020 level. In recent months, employment for seniors has been at its lowest point during the pandemic.

    What are we watching for?

    2021's employment numbers are a mixed sign for overall recovery. While total employment has climbed, some age groups are still behind where they were last year. Most groups saw some decline during the third wave of COVID cases, but youth and seniors in particular have seen significant losses. The economy recovered rapidly between August and October, but economic recovery is a work in progress. We are keeping a close eye on these 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 third wave of COVID-19 cases, but recent months have seen total employment recover. Between May 2021 and November 2021 female employment increased by 4,500 positions and male employment increased by 3,300 positions.

    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 childcare. 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.

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. By May 2020, these industries had lost 7,600 and 7,300 employees, respectively. Accommodation and food service 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 3,100 positions between April and November of this year.

    Despite declines during periods of high COVID-19 cases, employment in wholesale and retail trade has recovered quickly. The sector has seen declines due to the third wave, dropping by 1,600 positions in May, but rebounding by 7,300 positions between May and November. Most other industries suffered fewer losses in total employment, with many industries losing fewer than 2,000 employees at their worst point. Both recovery and seasonal employment have contributed to overall growth. Overall employment in November 2021 is roughly 4.2% 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. May and June data show the effects of a third wave of COVID cases and its economic effects, while data since July show signs of recovery. As we experienced during the first and second 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 in 2021, dropping by 5.2% in May, rebounding by 20.4% in June, and dropping by another 6.2% between June and September. However, all sectors are up from where they were at the start of the year, especially clothing stores (up 85%), furniture and home furnishings (up 51%), and motor vehicles (up 43%). Aggregate sales have risen 31% since the beginning of the year (January 2021) and are up 41% since prior to the pandemic (January 2020). As of June 2021, sales in each retail sector have recovered and remained above their pre-pandemic levels.

    While aggregate sales are up in 2021, this number combines the impacts of sales volumes and prices. Nova Scotia's annualized inflation rate in September 2021 was 5.4%, while aggregate sales rose by 13.5% during the same period. This suggests nearly half this change in value may be attributable to rising prices. The effects are not uniform across industries either. For example, aggregate gasoline station sales increased by 37% between September 2020 and September 2021, while the price index of gasoline increased by 51%. This suggests that the volume of gasoline sales may have decreased.

    What are we watching for?

    Overall retail sales paint a generally positive picture, but it is also important to look more closely at specific 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 June far exceeded expectations and is a positive sign for overall economic progress. However, another threat to the economy looms in the future, as the prospect of inflation could erode many of the benefits of recovery. With the public health situation stabilizing, we can expect gradual improvement in retail numbers, but some industries may be slower to grow than others. It will be important to understand the pace of recovery and how different industries respond to recovery efforts.

Debt

Debt is an important economic indicator to measure how families and businesses are handling the downturn. Surprisingly, we have yet to see the debt-related issues we might have expected from an economic downturn. Business and consumer insolvencies in Halifax have been low through 2020 and 2021, 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 $21,081 per consumer in Q3 2021, down 3.90% since Q3 2020. Delinquency rates dropped precipitously in the middle of last year, falling by nearly a third to 1.08% in Q3 2020. Since then they have remained low and are currently sitting at 0.99% in 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 remained low throughout 2020 and into 2021. There were only 246 bankruptcies and insolvency proposals in Q3 2021, less than 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 in 2020. There were 0 bankruptcies in Q3 2021, well 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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