Canada’s “economy” is recovering faster than expected, but employment is lagging. The Organization for Economic Co-operation and Development (OECD), a group promoting trade between 37 advanced economies, published the latest unemployment rates for member countries. The data shows Canada is significantly behind its G7 peers, with only a few OECD countries worse off. Canada is also seeing the unemployment rate rise, while its biggest trade partner is seeing the rate fall.
About The Data
The OECD’s unemployment data is organized by the latest rate reported, which isn’t always the same month. Countries report around the same time, but for different months. In particular, Canada and the US’ most recent data point is for January. The rest of the G7 (including the aggregate), and OECD are reporting December’s numbers.
Does this make the comparison unfair? Nope. Some data points will be a little more stale, but the gap and direction of change are important. Substantial gaps aren’t likely to close, in just a month or two. Likewise, indicators with small lateral movements are likely stable. At this point, most countries are way past their worst economic woes, and are focused on recovery. The rates help tell us a lot about how countries are faring with the pandemic.
Canadian Unemployment Makes A Sharp Increase, Topping The G7
Canada’s unemployment rate made a sharp rise, making it one of the worst rates of any advanced economy. The unemployment rate fell to 9.4% in the last reported data point, up 8.8% from the previous month. A sharp uptick that brought the rate 67.86% higher than the same month last year. Canada’s unemployment rate is now much higher than most of its peers.
How Does Canada’s Unemployment Rate Compare?The unemployment rate of G7 countries, and the OECD average for the latest reporting period. Source: OECD, Better Dwelling.
U.S. Unemployment Is Falling, While Canada’s Rate Is Rising
The U.S., Canada’s biggest trade partner, is doing considerably better in terms of unemployment. OECD data shows the US unemployment rate was at 6.30% at the last data point, down 5.97% from a month before. This is 32.98% lower than Canada’s unemployment rate. Equally important is this rate is falling, while Canada’s rate has been rising over the same period. Things are getting better in the US, and worse in Canada.
The G7 Average Unemployment Rate Is 39% Lower Than Canada
Canada’s unemployment rate is much higher than its G7 peers. The G7 average rate of unemployment is 6.06% at last reporting, up 1.00% from the month before. The rate is 39.19% lower than Canada’s last reported rate. Japan is the lowest country in the group with an unemployment rate of just 2.90%, 69.15% lower than Canada’s. Canada’s unemployment isn’t just significantly higher. It’s last reported number is the highest rate of any G7 country, by a large margin.
The OECD Average Unemployment Is 26% Lower Than Canada
The OECD’s 37 member average, is also much better than Canada’s unemployment rate. The average was last reported at 6.88%, virtually flat from the month before. This rate is 26.76% lower than Canada’s latest rate. Only 7 OECD countries rank above Canada, and they include Chile, Lithuania, and Greece. These countries all had significantly higher unemployment rates than Canada, before the pandemic. They’re also not typically compared, due to the size of their GDP in contrast to Canada.
Different countries are likely to be at different points of their recovery. Different rates shouldn’t be surprising, but large gaps and rising unemployment rates are concerning. Canada is trailing its G7 peers, and very few OECD countries are doing worse. Oddly enough, Canada’s real estate is rising the fastest out of any G7 country at the same time. It would appear Canada is focused on an entirely different goal from the rest of the pack.
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