The magnitude of change in the Canadian economy since the onset of COVID-19 has been profound, says a new report released Wednesday by Statistics Canada.

From February to May, total employment has fallen by over 2.7 million, as the unemployment rate rose to a record high 13.7 per cent, it reported. Also a flash estimate of GDP it released in late May projected an 11 per cent decline in real GDP in April, following March’s 7.2 per cent decrease.

“Real gross domestic product (GDP) fell by 7.2 per cent in March as COVID-19 related shutdowns severely impacted the output of service industries. Real GDP contracted 2.1 per cent in the first quarter, the largest quarterly decline since early 2009. Severe reductions in auto-related sales contributed to substantial declines in economic activity as the shutdowns extended through April. Merchandise trade activity in April fell to the lowest level in almost a decade, while manufacturing sales declined by almost 30 per cent. Retail sales in April fell by over one-quarter. An advance estimate of real GDP, released by Statistics Canada at the end of May, pointed to an approximate 11 per cent decline in April,” it said.    

“Following employment losses of three million during March and April, employment rose by 290,000 in May, led by gains in Quebec as restrictions on economic activity eased. The unemployment rate rose to a record 13.7 per cent in May as the number of people searching for work increased substantially as job seekers re-entered the labour force. However, 1.4 million Canadians wanted to work in May but did not search for a job, while more than one-third of Canada’s potential labour force remained fully or partially underutilized. 

“Household expenditures fell by a record 2.3 per cent (in the first quarter) as public health restrictions severely impacted economic activity during the last two weeks of March. Lower spending on services accounted for about two-thirds of the overall decrease in household spending, led by sharp reductions in food, beverage and accommodation services, and recreational services. Outlays on goods also fell as lower spending on autos and clothing was partly offset by higher spending on food.”

StatsCan added that export volumes were down three per cent in the first quarter, the third consecutive decline and the largest quarterly decrease in almost four years. Non-residential business investment was down 0.7 per cent in the first quarter.