Labour Statistics: Research Papers
Labour market dynamics since the 2008/2009 recession

by Emmanuelle Bourbeau

Release date: January 29, 2019 Updated on: February 8, 2019

Skip to text

Text begins

Summary/highlights

This analysis uses data from the Labour Force Survey in order to observe Canadian labour market dynamics since the 2008/2009 recession. In order to do this, gross flow data were created using a different method than what has been done before for Canadian data.

This study helps to answer several questions: what proportion of the population changes their labour force status each month? What were the movements underlying the large changes in the labour market indicators? During the recession, did employment decrease because of an increase in the number of people that lost or quit their job and/or a decrease in the number of people having found a job? What is the probability of changing labour force status between two consecutive months?

1. Introduction

Every month, the Labour Force Survey (LFS) data published by Statistics Canada garner much attention. Be it the unemployment rate, employment levels, or the proportion of the population participating in the labour force, LFS estimates are used for many purposes, such as taking the pulse of the labour market, administering the Employment Insurance program, or contributing to policy analysis.

When economic shocks occur, shifts in labour market indicators are quickly identifiable. During the last recession in 2008/2009, employment fell by 426,000 between October 2008 and July 2009, while the number of unemployed persons rose by 460,000. Over the same period, the employment rate fell by 2.2 percentage points and the unemployment rate rose by 2.5 percentage points.

Chart 1 Employment and unemployment in Canada

Data table for Chart 1 
Data table for chart 1
Table summary
This table displays the results of Data table for chart 1 Employment (left axis) and Number of unemployed (right axis), calculated using thousands units of measure (appearing as column headers).
Employment (left axis) Number of unemployed (right axis)
thousands
2007
January 16,621.5 1,104.1
February 16,642.6 1,097.2
March 16,690.7 1,091.1
April 16,675.7 1,097.3
May 16,698.8 1,064.2
June 16,756.1 1,083.0
July 16,798.8 1,072.5
August 16,806.5 1,063.2
September 16,851.5 1,053.4
October 16,907.1 1,047.4
November 16,923.5 1,072.7
December 16,926.9 1,077.3
2008
January 16,952.8 1,063.4
February 16,998.2 1,073.4
March 16,982.8 1,098.4
April 17,002.4 1,090.0
May 17,007.4 1,090.6
June 17,000.7 1,079.1
July 16,991.9 1,097.0
August 17,010.7 1,095.6
September 17,072.0 1,104.6
October 17,100.6 1,122.5
November 16,979.2 1,199.3
December 16,948.2 1,251.1
2009
January 16,823.4 1,343.9
February 16,770.8 1,452.5
March 16,752.5 1,483.8
April 16,709.5 1,512.9
May 16,683.5 1,564.1
June 16,674.1 1,585.7
July 16,674.6 1,582.5
August 16,682.9 1,580.8
September 16,710.7 1,529.4
October 16,718.4 1,532.7
November 16,799.0 1,563.5
December 16,783.7 1,553.7
2010
January 16,828.3 1,517.7
February 16,845.5 1,513.0
March 16,857.9 1,514.6
April 16,934.6 1,499.0
May 16,949.5 1,480.4
June 17,019.7 1,463.6
July 17,010.9 1,490.9
August 17,025.2 1,509.6
September 16,989.8 1,507.4
October 17,025.2 1,448.7
November 17,056.4 1,405.5
December 17,091.6 1,411.2
2011
January 17,143.7 1,439.6
February 17,140.4 1,430.3
March 17,163.3 1,427.0
April 17,199.6 1,420.6
May 17,182.4 1,395.2
June 17,229.9 1,394.8
July 17,249.7 1,359.8
August 17,276.1 1,357.2
September 17,284.3 1,374.0
October 17,264.5 1,380.4
November 17,259.0 1,408.9
December 17,292.4 1,387.2
2012
January 17,265.6 1,430.0
February 17,263.3 1,391.6
March 17,357.3 1,365.7
April 17,450.3 1,365.1
May 17,429.1 1,387.3
June 17,452.5 1,347.0
July 17,428.9 1,362.7
August 17,476.7 1,352.5
September 17,511.6 1,369.7
October 17,531.2 1,405.7
November 17,560.4 1,369.8
December 17,604.5 1,366.8
2013
January 17,617.0 1,336.8
February 17,640.9 1,339.4
March 17,610.3 1,387.5
April 17,643.2 1,357.0
May 17,682.7 1,328.2
June 17,688.6 1,361.6
July 17,684.4 1,363.5
August 17,724.1 1,352.2
September 17,728.4 1,324.2
October 17,737.8 1,342.0
November 17,743.9 1,330.0
December 17,735.4 1,378.2
2014
January 17,746.4 1,339.2
February 17,754.9 1,340.9
March 17,771.0 1,338.5
April 17,762.6 1,336.0
May 17,749.5 1,335.7
June 17,774.8 1,342.1
July 17,807.5 1,359.6
August 17,791.4 1,334.1
September 17,820.8 1,311.0
October 17,876.3 1,273.8
November 17,859.4 1,283.6
December 17,843.6 1,273.6
2015
January 17,874.7 1,268.3
February 17,891.7 1,302.2
March 17,904.8 1,306.5
April 17,898.6 1,314.8
May 17,941.7 1,317.1
June 17,949.0 1,320.3
July 17,976.3 1,318.2
August 17,990.4 1,351.6
September 17,987.1 1,367.7
October 18,007.1 1,346.1
November 17,986.6 1,377.1
December 17,995.6 1,385.2
2016
January 17,991.1 1,390.8
February 17,998.1 1,405.2
March 18,029.4 1,366.9
April 18,043.3 1,383.3
May 18,035.1 1,346.1
June 18,054.3 1,327.6
July 18,044.2 1,349.9
August 18,081.1 1,357.7
September 18,147.7 1,362.4
October 18,183.5 1,344.8
November 18,185.5 1,336.4
December 18,217.8 1,350.6
2017
January 18,268.4 1,318.3
February 18,290.0 1,286.4
March 18,308.6 1,299.8
April 18,325.4 1,259.5
May 18,358.0 1,285.7
June 18,413.1 1,272.4
July 18,436.2 1,234.0
August 18,458.8 1,213.7
September 18,471.4 1,217.9
October 18,499.1 1,221.1
November 18,580.3 1,168.0
December 18,645.1 1,139.1
2018
January 18,557.1 1,153.4
February 18,572.5 1,144.3
March 18,604.8 1,142.1
April 18,603.7 1,155.0
May 18,596.2 1,151.6
June 18,628.0 1,195.3
July 18,682.1 1,160.4
August 18,630.5 1,195.2
September 18,693.8 1,171.1

While these statistics are widely known and used, it may be less understood that the data published every month are "stocks" – snapshots taken at a specific moment in time, the survey reference week.

These levels, or stocks, are often the outcome of many underlying movements in labour force status. These movements have a temporal aspect to them; namely, they are quantities in relation to time referred to as "flows". In the case of labour force surveys, where the respondents remain in the sample for more than one month, these movements can be examined.Note 

Changes in stocks observed between two months are much smaller than what is depicted in statistics on gross flows.Note  In fact, the Canadian labour market is very dynamic. According to Labour Force Survey (LFS) data, from January 2007 to September 2018, approximately 6.2% of the working-age population, on average, changed their labour force status each month.Note  After rising during the recession, the average trended down and has been below 6.0% since the spring of 2016.

Changes in labour market indicators may happen for different reasons. For example, a decline in employment may be due to fewer people moving from "unemployed" to "employed" and/or a decrease in the number of people moving from "not in the labour force" to "employed".

Knowing the origin and destination statuses of the people moving in the labour market provides a more complete picture of the situation and contributes to a better understanding of labour market dynamics in Canada, which can in turn help guide policy development.

1.1 About labour market flows

Analyzing gross flows helps to establish the magnitude of the movement between different labour force statuses by modelling changes in employment, unemployment and labour force inactivity in terms of inflows and outflows. These statistics are interesting, as they can help address various questions about labour force dynamics. For example, they can shed light on the cyclical characteristics of worker flows and the relative importance of respondent inflows and outflows in explaining changes in employment levels, unemployment and inactivity. Statistics on flows can also be used to calculate the probability that an employed person will change status between two months.

Studying gross flows can also help guide policy decisions. For example, if there is interest in developing a policy to reduce the number of unemployed persons following an increase, it is important to know the movements that led to the increase. A change in unemployment caused by major layoffs does not have the same implications as one caused by difficulty in finding a job.

Although Statistics Canada produced gross flow data using LFS data in the 1980s, production was halted because of concerns over data reliability.Note  At the time, the data were used to study the structure of unemployment in Canada and Quebec (Hasan and De Broucker 1985; Mayer et al. 1985). Other researchers have used LFS data to analyze the cyclical and seasonal properties of gross flows. It was shown that flows into unemployment are countercyclical, while the opposite is true for flows out of unemployment (Jones 1993; Campolieti 2011). The gross flows data presented in this paper have been created using a different methodology from these past studies.

After the last recession, articles on gross flow movements during that period were published in some countries. Although the results are not fully comparable with Canadian data, the different assumptions and conclusions are interesting to note. For example, the increase in the number of people moving from inactivity to looking for work (flow from not in the labour force to unemployed, referred to as NU flow) in Great Britain began before the last recession and may reflect the impact of a specific policy intended to encourage individuals not in the labour force to enter the labour market (Sutton 2012).

In the United States, an increase in the flow of individuals from inactivity to unemployment may reflect the difficulty in finding employment upon entering the labour market (Frazis and Ilg 2009). One hypothesis discussed by Sahin et al. (2010), who analyzed NU flow by gender, was the "added worker effect"Note  for women and a higher labour supply for men who were not in the labour force during the last recession. During significant recessions, changes in the rate of job separation (transition rate from employed to unemployed) account for most of the fluctuations in the unemployment rate (Davis, Faberman and Haltiwanger 2006; Gomes 2009).

2. Data and methodology

2.1 Labour Force Survey (LFS)

The data used for this analysis are from the LFS, a cross-sectional sample survey. Every month, the LFS collects data from approximately 56,000 Canadian households for individuals aged 15 years and over, excluding full-time members of the Armed Forces, persons living on an Indian reserve, and institutional residents.

The LFS uses a rotating panel design. A selected household remains in the sample for six consecutive months. Each month, as one household completes its six months in the survey, it is replaced by another household from the same, or a comparable, geographic area.Note  Consequently, five-sixths of the sample is common from one month to the next.

Although the survey was designed to estimate, among other concepts, the number of persons employed (E), unemployed (U) or not in the labour force (N) during the reference week, the five-sixths sample overlap allows for estimates of the number of persons who had a change in their labour force status between two consecutive months. The method used for matching data from one month to another is briefly discussed in the next section.

2.2 Gross flows

Theoretically, it would be possible to match 83.3% of the sample between two consecutive months, and to estimate the changes in labour force status from five-sixths of respondents, as this is the degree of overlap in the sample. However, a certain proportion of those surveyed do not consistently respond each month. In fact, data matching was possible for between 80% and 81% of the initial sample over the study years. If we consider that 16.7% of the non-matches resulted from rotation of the sample, then a maximum of 3.3% were not matched for other reasons.

To correct for this bias, referred to as "margin error," data were adjusted using a methodology similar to the one used by the United States Bureau of Labor Statistics to produce gross flows.Note  This method is used to estimate data for the missing rotation, as well as other inflows and outflows (deaths, migrations, young people who turn 15 between the two months, etc.).

Another difficulty in estimating gross flows bears mentioning: bias caused by errors in classifying the labour force status. This error may lead to incorrect transitions. For example, consider a person who is looking for a job over three consecutive months, but who, by mistake, is classified as not looking for work during the second month. As a result, there would be two incorrect transitions. The first would be observed between the first and second month (from unemployed to not in the labour force) and the second during the third month (from not in the labour force to unemployed).Note 

2.3 Analysis methodology

This analysis covers the period from October 2007 to September 2018. To study the composition of the changes in published levels and rates, the transitions analyzed are those between the three main labour force statuses: employed (E), unemployed (U) and not in the labour force (N).Note  The matrix below shows these transitions.

Matrix 1 Labour market gross flows
Table summary
This table displays the results of Labour force status Labour force status in month (t+1) (appearing as column headers).
Labour force status in month ( t+1 MathType@MTEF@5@5@+= feaagKart1ev2aaatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVu0Je9sqqrpepC0xbbL8F4rqqrFfpeea0xe9Lq=Jc9 vqaqpepm0xbba9pwe9Q8fs0=yqaqpepae9pg0FirpepeKkFr0xfr=x fr=xb9adbaqaaeGaciGaaiaabeqaamaabaabaaGcbaaeaaaaaaaaa8 qacaWG0bGaey4kaSIaaGymaaaa@38AC@ )
Employed Unemployed Inactive
Labour force status in month ( t MathType@MTEF@5@5@+= feaagKart1ev2aaatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVu0Je9sqqrpepC0xbbL8F4rqqrFfpeea0xe9Lq=Jc9 vqaqpepm0xbba9pwe9Q8fs0=yqaqpepae9pg0FirpepeKkFr0xfr=x fr=xb9adbaqaaeGaciGaaiaabeqaamaabaabaaGcbaaeaaaaaaaaa8 qacaWG0baaaa@370F@ )
Employed
EE
EU
EN
Unemployed
UE
UU
UN
Inactive
NE
NU
NN

The notation comprises two uppercase letters. The first letter represents the labour force status in the previous month ( t MathType@MTEF@5@5@+= feaagKart1ev2aaatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVu0Je9sqqrpepC0xbbL8F4rqqrFfpeea0xe9Lq=Jc9 vqaqpepm0xbba9pwe9Q8fs0=yqaqpepae9pg0FirpepeKkFr0xfr=x fr=xb9adbaqaaeGaciGaaiaabeqaamaabaabaaGcbaaeaaaaaaaaa8 qacaWG0baaaa@370F@ ) and the second represents the status in the current month ( t+1 MathType@MTEF@5@5@+= feaagKart1ev2aaatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVu0Je9sqqrpepC0xbbL8F4rqqrFfpeea0xe9Lq=Jc9 vqaqpepm0xbba9pwe9Q8fs0=yqaqpepae9pg0FirpepeKkFr0xfr=x fr=xb9adbaqaaeGaciGaaiaabeqaamaabaabaaGcbaaeaaaaaaaaa8 qacaWG0bGaey4kaSIaaGymaaaa@38AC@ ). For example, UE means that the respondent was unemployed during the reference week of the previous month and employed during the reference week of the current month.

Transition rates between statuses are calculated using gross flow data. These rates indicate the probabilityNote  that an individual will change statuses between two consecutive months. For example, the calculation of the probability of moving from employed to unemployed is illustrated in equation 1.

p t EU = E U t+1 E t    (1) MathType@MTEF@5@5@+= feaagKart1ev2aaatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVu0Je9sqqrpepC0xbbL8F4rqqrFfpeea0xe9Lq=Jc9 vqaqpepm0xbba9pwe9Q8fs0=yqaqpepae9pg0FirpepeKkFr0xfr=x fr=xb9adbaqaaeGaciGaaiaabeqaamaabaabaaGcbaaeaaaaaaaaa8 qacaWGWbWdamaaDaaaleaapeGaamiDaaWdaeaapeGaamyraiaadwfa aaGccqGH9aqpdaWcaaWdaeaapeGaamyraiaadwfapaWaaSbaaSqaa8 qacaWG0bGaey4kaSIaaGymaaWdaeqaaaGcbaWdbiaadweapaWaaSba aSqaa8qacaWG0baapaqabaaaaaaa@421D@

In this example, the transition rate represents the probability that a person who is employed during period t MathType@MTEF@5@5@+= feaagKart1ev2aqatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVu0Je9sqqrpepC0xbbL8F4rqqrFfpeea0xe9Lq=Jc9 vqaqpepm0xbba9pwe9Q8fs0=yqaqpepae9pg0FirpepeKkFr0xfr=x fr=xb9adbaqaaeGaciGaaiaabeqaamaabaabaaGcbaaeaaaaaaaaa8 qacaWG0baaaa@3710@ will lose or leave their job in period t+1 MathType@MTEF@5@5@+= feaagKart1ev2aaatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVu0Je9sqqrpepC0xbbL8F4rqqrFfpeea0xe9Lq=Jc9 vqaqpepm0xbba9pwe9Q8fs0=yqaqpepae9pg0FirpepeKkFr0xfr=x fr=xb9adbaqaaeGaciGaaiaabeqaamaabaabaaGcbaaeaaaaaaaaa8 qacaWG0bGaey4kaSIaaGymaaaa@38AC@ and will be looking for employment. The rate is calculated by dividing the number of persons who moved from employed to unemployed ( E t   U t+1 ) MathType@MTEF@5@5@+= feaagKart1ev2aqatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVu0Je9sqqrpepC0xbbL8F4rqqrFfpeea0xe9Lq=Jc9 vqaqpepm0xbba9pwe9Q8fs0=yqaqpepae9pg0FirpepeKkFr0xfr=x fr=xb9adbaqaaeGaciGaaiaabeqaamaabaabaaGcbaGaaiikaabaaa aaaaaapeGaamyra8aadaWgaaWcbaWdbiaadshaa8aabeaakmaaBaaa leaacqGHsgIRaeqaaOGaaeiia8qacaWGvbWdamaaBaaaleaapeGaam iDaiabgUcaRiaaigdaa8aabeaakiaacMcaaaa@4041@ between the two months by the total number of persons employed in month t MathType@MTEF@5@5@+= feaagKart1ev2aqatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVu0Je9sqqrpepC0xbbL8F4rqqrFfpeea0xe9Lq=Jc9 vqaqpepm0xbba9pwe9Q8fs0=yqaqpepae9pg0FirpepeKkFr0xfr=x fr=xb9adbaqaaeGaciGaaiaabeqaamaabaabaaGcbaaeaaaaaaaaa8 qacaWG0baaaa@3710@ .Note 

Although the gross flow data used for this analysis are seasonally adjusted, six-month moving averages were used to produce the charts in order to ensure more stable estimates.

3. Gross flows in Canada

To show the extent of transitions in the labour market, Table 1 presents the estimated average for each of the nine principal gross flows over the study period; in other words, the average monthly flows between October 2007 and September 2018. The table also presents gross flows as a proportion of the working-age population.

The vast majority of people maintain the same labour force status across two consecutive months. For example, almost 17 million workers, on average, remained employed in the subsequent month, which represents 59.5% of the population aged 15 and over. It should be noted, however, that this does not necessarily mean that these workers did not change jobs. It is possible that they did change jobs over the two consecutive months, but these transitions are not taken into account by this analysis.

Over the study period, an average of 289,000 jobseekers in a given month were employed in the subsequent month, or 1.0% of the working-age population. Similarly, an average of 233,000 workers became unemployed (0.8% of the population aged 15 years and over). Flows from inactivity to employment and vice versa were larger in magnitude.

Table 1
Average gross flows in level and in proportion of the working age population, October 2007 to September 2018
Table summary
This table displays the results of Average gross flows in level and in proportion of the working age population, October 2007 to September 2018. The information is grouped by Averages from October 2007 to September 2018 (appearing as row headers), Labour force status current month (t+1), Gross flows (thousands) and Proportion of the population adged 15 and over (%) (appearing as column headers).
Averages from October 2007 to September 2018 Labour force status current month ( t+1 MathType@MTEF@5@5@+= feaagKart1ev2aaatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVu0Je9sqqrpepC0xbbL8F4rqqrFfpeea0xe9Lq=Jc9 vqaqpepm0xbba9pwe9Q8fs0=yqaqpepae9pg0FirpepeKkFr0xfr=x fr=xb9adbaqaaeGaciGaaiaabeqaamaabaabaaGcbaaeaaaaaaaaa8 qacaWG0bGaey4kaSIaaGymaaaa@38AC@ )
Employed Unemployed Inactive Employed Unemployed Inactive
gross flows (thousands) proportion of the population aged 15 and over (%)
Labour force status previous month ( t MathType@MTEF@5@5@+= feaagKart1ev2aqatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVu0Je9sqqrpepC0xbbL8F4rqqrFfpeea0xe9Lq=Jc9 vqaqpepm0xbba9pwe9Q8fs0=yqaqpepae9pg0FirpepeKkFr0xfr=x fr=xb9adbaqaaeGaciGaaiaabeqaamaabaabaaGcbaaeaaaaaaaaa8 qacaWG0baaaa@3710@ )
Employed 16,958 233 384 59.5 0.8 1.3
Unemployed 289 802 239 1.0 2.8 0.8
Inactive 326 294 8,928 1.1 1.0 31.3

To study variations in employment and unemployment levels and rates, the analysis will be divided into six periods:

Chart 2 Unemployment rate and emploment rate in Canada, January 2007 to September 2018, monthly, seasonally adjusted

Data table for Chart 2 
Data table for chart 2
Table summary
This table displays the results of Data table for chart 2 Unemployment rate (left axis) and Employment rate (right axis), calculated using percent units of measure (appearing as column headers).
Unemployment rate (left axis) Employment rate (right axis)
percent
2007
January 6.2 63.2
February 6.2 63.2
March 6.1 63.3
April 6.2 63.2
May 6.0 63.2
June 6.1 63.4
July 6.0 63.4
August 5.9 63.4
September 5.9 63.5
October 5.8 63.6
November 6.0 63.6
December 6.0 63.6
2008
January 5.9 63.6
February 5.9 63.7
March 6.1 63.6
April 6.0 63.6
May 6.0 63.5
June 6.0 63.4
July 6.1 63.3
August 6.1 63.3
September 6.1 63.4
October 6.2 63.5
November 6.6 63.0
December 6.9 62.8
2009
January 7.4 62.3
February 8.0 62.0
March 8.1 61.9
April 8.3 61.6
May 8.6 61.5
June 8.7 61.3
July 8.7 61.3
August 8.7 61.2
September 8.4 61.2
October 8.4 61.2
November 8.5 61.4
December 8.5 61.3
2010
January 8.3 61.4
February 8.2 61.4
March 8.2 61.4
April 8.1 61.6
May 8.0 61.6
June 7.9 61.8
July 8.1 61.6
August 8.1 61.6
September 8.1 61.4
October 7.8 61.5
November 7.6 61.5
December 7.6 61.6
2011
January 7.7 61.8
February 7.7 61.7
March 7.7 61.7
April 7.6 61.8
May 7.5 61.7
June 7.5 61.8
July 7.3 61.8
August 7.3 61.8
September 7.4 61.7
October 7.4 61.6
November 7.5 61.5
December 7.4 61.6
2012
January 7.6 61.4
February 7.5 61.4
March 7.3 61.6
April 7.3 61.9
May 7.4 61.7
June 7.2 61.7
July 7.3 61.6
August 7.2 61.7
September 7.3 61.7
October 7.4 61.7
November 7.2 61.8
December 7.2 61.9
2013
January 7.1 61.9
February 7.1 61.9
March 7.3 61.7
April 7.1 61.8
May 7.0 61.8
June 7.1 61.8
July 7.2 61.7
August 7.1 61.8
September 7.0 61.7
October 7.0 61.7
November 7.0 61.6
December 7.2 61.6
2014
January 7.0 61.5
February 7.0 61.5
March 7.0 61.5
April 7.0 61.4
May 7.0 61.3
June 7.0 61.3
July 7.1 61.4
August 7.0 61.3
September 6.9 61.3
October 6.7 61.5
November 6.7 61.4
December 6.7 61.3
2015
January 6.6 61.3
February 6.8 61.4
March 6.8 61.4
April 6.8 61.3
May 6.8 61.4
June 6.9 61.3
July 6.8 61.4
August 7.0 61.4
September 7.1 61.3
October 7.0 61.3
November 7.1 61.2
December 7.1 61.2
2016
January 7.2 61.1
February 7.2 61.1
March 7.0 61.1
April 7.1 61.1
May 6.9 61.0
June 6.8 61.0
July 7.0 60.9
August 7.0 61.0
September 7.0 61.2
October 6.9 61.3
November 6.8 61.2
December 6.9 61.3
2017
January 6.7 61.4
February 6.6 61.4
March 6.6 61.5
April 6.4 61.4
May 6.5 61.5
June 6.5 61.6
July 6.3 61.6
August 6.2 61.6
September 6.2 61.6
October 6.2 61.6
November 5.9 61.9
December 5.8 62.0
2018
January 5.9 61.7
February 5.8 61.7
March 5.8 61.7
April 5.8 61.6
May 5.8 61.5
June 6.0 61.5
July 5.8 61.6
August 6.0 61.4
September 5.9 61.5

3.1. Variations in employment

After a slight increase over the 12-month period preceding the 2008/2009 recession, the employment level fell sharply from October 2008 to July 2009. The employment rate also declined significantly, and although the employment level has since bounced back, the employment rate is still below what was observed before the recession. What are the underlying movements that can help to better understand these changes?

Chart 3 shows inflows to and outflows from employment, as well as the employment level. Flows into employment (UE+NE) are the sum of persons who moved from unemployed to employed (UE) and from not in the labour force to employed (NE). Flows out of employment (EU+EN) represent the sum of persons who moved from employed to unemployed (EU) and from employed to not in the labour force (EN). Table 2, in the appendix, presents the results for each study period.

By definition, an increase in employment is observed when inflows to employment (UE+NE) are greater than outflows from employment (EU+EN). Conversely, a decline is seen when inflows are less than outflows. Generally, a decrease in the employment rate stems from a reduction in inflows to employment and an increase in outflows.

Chart 3 Employed, inflows to and outflows from employment January 2007 to September 2018, six-month moving average, seasonally adjusted

Data table for Chart 3 
Data table for chart 3
Table summary
This table displays the results of Data table for chart 3 Inflows to employment (UE+NE), Outflows from employment (EU+EN) and Number of people employed, calculated using thousands units of measure (appearing as column headers).
Inflows to employment (UE+NE) Outflows from employment (EU+EN) Number of people employed
thousands
2007
January 649.55 630.93 16,621.50
February 642.28 619.16 16,632.05
March 643.74 616.39 16,651.60
April 640.67 620.32 16,657.63
May 638.13 618.61 16,665.86
June 643.35 625.48 16,680.90
July 645.98 631.07 16,710.45
August 644.84 633.31 16,737.77
September 645.50 634.77 16,764.57
October 648.29 625.13 16,803.13
November 645.57 623.26 16,840.58
December 640.65 626.31 16,869.05
2008
January 633.26 621.27 16,894.72
February 639.39 620.07 16,926.67
March 631.54 622.78 16,948.55
April 628.19 626.29 16,964.43
May 629.00 629.00 16,978.42
June 624.03 628.09 16,990.72
July 616.84 626.47 16,997.23
August 614.21 629.75 16,999.32
September 622.96 626.41 17,014.18
October 630.51 631.43 17,030.55
November 624.77 646.97 17,025.85
December 630.32 654.76 17,017.10
2009
January 635.10 678.62 16,989.02
February 634.94 689.94 16,949.03
March 633.16 701.03 16,895.78
April 624.92 705.11 16,830.60
May 635.55 700.26 16,781.32
June 630.85 693.31 16,735.63
July 634.51 675.73 16,710.83
August 635.48 666.06 16,696.18
September 635.51 659.47 16,689.22
October 635.13 650.41 16,690.70
November 637.89 635.03 16,709.95
December 640.62 637.69 16,728.22
2010
January 641.16 631.30 16,753.83
February 640.26 628.96 16,780.93
March 634.24 623.87 16,805.47
April 638.40 616.58 16,841.50
May 629.53 618.81 16,866.58
June 638.36 614.48 16,905.92
July 632.15 617.24 16,936.35
August 632.26 618.40 16,966.30
September 626.54 620.81 16,988.28
October 627.27 628.30 17,003.38
November 637.65 635.15 17,021.20
December 629.02 630.78 17,033.18
2011
January 636.42 627.75 17,055.32
February 633.78 627.75 17,074.52
March 640.75 624.50 17,103.43
April 644.34 627.88 17,132.50
May 635.13 627.99 17,153.50
June 634.61 625.69 17,176.55
July 631.03 627.71 17,194.22
August 635.13 628.33 17,216.83
September 631.24 628.01 17,237.00
October 625.34 631.96 17,247.82
November 627.72 631.59 17,260.58
December 633.80 640.29 17,271.00
2012
January 632.86 646.57 17,273.65
February 636.13 653.22 17,271.52
March 647.25 649.73 17,283.68
April 655.89 639.92 17,314.65
May 647.49 634.95 17,343.00
June 639.62 629.94 17,369.68
July 634.92 626.22 17,396.90
August 630.56 613.59 17,432.47
September 627.90 620.47 17,458.18
October 621.30 625.36 17,471.67
November 629.90 625.25 17,493.55
December 628.85 618.97 17,518.88
2013
January 634.85 618.49 17,550.23
February 630.41 617.12 17,577.60
March 622.63 620.64 17,594.05
April 624.02 621.23 17,612.72
May 624.51 620.27 17,633.10
June 630.50 633.49 17,647.12
July 629.48 635.52 17,658.35
August 634.53 638.13 17,672.22
September 635.38 633.36 17,691.90
October 629.22 629.28 17,707.67
November 625.99 630.76 17,717.87
December 617.25 623.71 17,725.67
2014
January 612.71 615.91 17,736.00
February 610.15 618.37 17,741.13
March 607.54 613.04 17,748.23
April 603.25 613.29 17,752.37
May 599.07 611.82 17,753.30
June 600.00 608.57 17,759.87
July 596.76 601.72 17,770.05
August 592.71 601.71 17,776.13
September 598.67 606.16 17,784.43
October 607.95 602.79 17,803.38
November 606.15 601.78 17,821.70
December 602.49 603.60 17,833.17
2015
January 608.28 608.52 17,844.37
February 605.88 601.67 17,861.08
March 598.60 596.42 17,875.08
April 595.98 604.91 17,878.80
May 605.43 604.84 17,892.52
June 610.72 607.85 17,910.08
July 602.51 601.84 17,927.02
August 607.86 606.52 17,943.47
September 605.84 608.03 17,957.18
October 604.68 602.36 17,975.27
November 595.84 603.77 17,982.75
December 596.61 602.12 17,990.52
2016
January 601.12 611.11 17,992.98
February 600.35 612.30 17,994.27
March 607.51 613.46 18,001.32
April 601.84 608.64 18,007.35
May 604.12 610.51 18,015.43
June 596.00 601.66 18,025.22
July 591.99 599.39 18,034.07
August 585.86 588.66 18,047.90
September 583.56 580.49 18,067.62
October 585.78 578.40 18,090.98
November 584.56 573.04 18,116.05
December 586.01 571.43 18,143.30
2017
January 591.76 567.13 18,180.67
February 592.53 569.90 18,215.48
March 594.16 579.40 18,242.30
April 592.04 581.79 18,265.95
May 598.21 585.74 18,294.70
June 601.95 586.99 18,327.25
July 601.40 590.77 18,355.22
August 603.26 593.82 18,383.35
September 596.64 586.89 18,410.48
October 597.77 585.81 18,439.43
November 595.97 574.47 18,476.48
December 596.24 572.87 18,515.15
2018
January 585.28 582.23 18,535.30
February 578.31 575.57 18,554.25
March 577.00 573.27 18,576.48
April 571.09 574.91 18,593.92
May 554.14 573.99 18,596.57
June 547.79 574.28 18,593.72
July 556.62 559.36 18,614.55
August 551.61 566.23 18,624.22
September 560.75 569.99 18,639.05

Between October 2007 and October 2008, employment rose by 1.1%, as inflows into employment were higher than outflows at the beginning of the period. Flows into employment decreased over the period, while outflows remained relatively stable, which slightly reduced the employment rate (-0.1 percentage points, reaching 63.5% in October 2008). Over the 12 months before the recession, both inflows and outflows averaged 629,000 per month, or 2.4% of the working-age population.

Over the course of the recession, employment declined by 426,000 (-2.5%) and the employment rate decreased by 2.2 percentage points to 61.3% by July 2009. These declines were attributable to an increase in the number of persons who lost or left their job (EU+EN). During this period, outflows from employment rose significantly to an average of 691,000 per month, while inflows remained essentially stable (629,000 on average). This is interesting because the decline in employment could have been caused by greater outflows combined with lower inflows, as observed at the beginning of the same recession in the United States. If this had been the case, employment in Canada would have decreased more substantially.

During the recovery period, employment grew, and regained the level observed prior to the recession in January 2011. Over this period, the increase in employment was characterized by a notable decrease in outflows (625,000 on average) combined with a moderate increase in inflows (637,000 on average).

Although the employment rate rose by 0.5 percentage points during this period, it remained below the rate observed prior to the recession. The increase in the employment rate was more modest because inflows to employment did not increase significantly compared with the previous period. In fact, when looking at inflows as a proportion of the working-age population, the proportion observed during the recovery period was very similar to the one recorded during the recession.

Employment continued to increase between January 2011 and January 2015, but at a slower annual pace. Mean inflows and outflows were practically of the same magnitude (rounded to 623,000 on average per month). Compared with the preceding period, inflows to employment declined and outflows remained fairly stable. The employment rate fell 0.5 percentage points during this period due to the reduction in inflows.

From January 2015 to February 2016, employment increased modestly (+0.7%), while inflows and outflows were at very similar levels. While both inflows and outflows fell over the period, a larger decline in inflows to employment led to a slight decrease in the employment rate (-0.2 percentage points). As discussed below, the unemployment rate trended upwards during this period, mainly linked to the effect of a decrease in oil prices on the labour market.

After the recent peak in the unemployment rate in February 2016, inflows to and outflows from employment began to trend downward. This trend lasted longer for outflows from employment. A gap once again appeared between the two series, when inflows began to increase, employment rose sharply from August 2016 to December 2017 (+3.1%), and the employment rate rose by one percentage point. The pace of growth slowed from January to September 2018, due to a reduction in inflows, which fell below the level of outflows.

3.1.1 Inflows to and outflows from employment and transition rates

An analysis of flows at a more disaggregated level gives further information on the factors that determine changes in inflows to and outflows from employment. Transition rates indicate the probability that an individual will move from one status in the previous month to another status in the current month (see Table 4). Chart 4 presents flows out of employment (EU and EN).

Chart 4 Outflows from employment, January 2007 to September 2018, six-month moving average, seasonally adjusted

Data table for Chart 4 
Data table for chart 4
Table summary
This table displays the results of Data table for chart 4 Employed to out of labour force (EN) and Employed to unemployed (EU), calculated using thousands units of measure (appearing as column headers).
Employed to out of labour force (EN) Employed to unemployed (EU)
thousands
2007
January 395.52 235.42
February 389.39 229.77
March 386.99 229.40
April 385.54 234.79
May 384.58 234.04
June 389.93 235.55
July 396.69 234.38
August 399.56 233.75
September 401.34 233.43
October 401.19 223.93
November 399.04 224.22
December 403.00 223.31
2008
January 397.53 223.75
February 395.28 224.79
March 396.50 226.27
April 396.43 229.85
May 396.73 232.26
June 394.04 234.05
July 393.77 232.70
August 398.15 231.60
September 397.70 228.71
October 400.89 230.55
November 408.66 238.31
December 407.95 246.81
2009
January 416.46 262.16
February 415.93 274.02
March 416.50 284.53
April 412.88 292.23
May 407.24 293.02
June 403.05 290.26
July 393.86 281.87
August 389.55 276.51
September 388.38 271.10
October 387.41 263.00
November 375.83 259.20
December 377.01 260.68
2010
January 376.39 254.91
February 377.00 251.96
March 374.99 248.88
April 368.11 248.47
May 376.31 242.50
June 375.42 239.06
July 374.82 242.42
August 376.22 242.18
September 378.74 242.07
October 388.58 239.72
November 391.82 243.34
December 392.02 238.76
2011
January 392.90 234.85
February 394.66 233.09
March 392.31 232.19
April 392.45 235.44
May 396.05 231.94
June 396.48 229.20
July 402.69 225.02
August 400.76 227.57
September 396.85 231.16
October 397.98 233.98
November 394.92 236.67
December 398.15 242.14
2012
January 395.02 251.55
February 400.98 252.24
March 399.87 249.86
April 392.52 247.40
May 388.67 246.27
June 386.13 243.81
July 386.54 239.69
August 378.58 235.01
September 384.45 236.02
October 385.20 240.16
November 387.17 238.08
December 381.68 237.30
2013
January 379.49 239.00
February 377.84 239.28
March 380.10 240.54
April 384.18 237.05
May 384.48 235.79
June 389.25 244.25
July 390.30 245.22
August 392.91 245.22
September 392.84 240.52
October 389.72 239.56
November 388.33 242.43
December 388.68 235.04
2014
January 387.45 228.46
February 388.78 229.59
March 382.09 230.95
April 383.40 229.88
May 384.82 226.99
June 382.05 226.52
July 372.60 229.11
August 373.94 227.77
September 378.80 227.37
October 377.50 225.29
November 375.90 225.87
December 383.62 219.97
2015
January 390.44 218.08
February 382.03 219.64
March 377.99 218.43
April 381.68 223.23
May 380.94 223.90
June 378.34 229.51
July 375.12 226.72
August 379.43 227.09
September 379.00 229.03
October 376.25 226.11
November 376.91 226.86
December 371.72 230.39
2016
January 373.63 237.48
February 376.55 235.75
March 380.56 232.90
April 378.29 230.36
May 379.08 231.44
June 377.59 224.06
July 379.38 220.01
August 372.04 216.62
September 363.44 217.04
October 361.57 216.84
November 358.55 214.50
December 354.87 216.55
2017
January 352.52 214.61
February 356.63 213.27
March 366.39 213.01
April 368.14 213.65
May 372.11 213.63
June 374.52 212.47
July 375.91 214.87
August 376.84 216.98
September 373.53 213.36
October 374.40 211.41
November 367.22 207.25
December 369.07 203.80
2018
January 377.39 204.84
February 374.25 201.32
March 370.75 202.52
April 372.23 202.68
May 375.03 198.96
June 372.72 201.55
July 361.17 198.19
August 364.55 201.69
September 367.34 202.65

Both outflows from employment (EU and EN) were relatively stable during the period leading up to the recession. The stability of flows out of employment was not caused by the movement of one flow offsetting the movement of the other.

The decline in employment observed during the recession was mainly attributable to the rise in the number of workers who became unemployed (EU). The p t EU MathType@MTEF@5@5@+= feaagKart1ev2aqatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVu0Je9sqqrpepC0xbbL8F4rqqrFfpeea0xe9Lq=Jc9 vqaqpepm0xbba9pwe9Q8fs0=yqaqpepae9pg0FirpepeKkFr0xfr=x fr=xb9adbaqaaeGaciGaaiaabeqaamaabaabaaGcbaaeaaaaaaaaa8 qacaWGWbWdamaaDaaaleaapeGaamiDaaWdaeaapeGaamyraiaadwfa aaaaaa@3A14@ transition rate increased over this period, indicating that employed individuals had a greater probability of becoming unemployed in the next month (see Chart 5).Note  The average number of workers who left the labour force (EN) was slightly higher during the recession compared with the previous period.

Chart 5 Transition rates from employment, January 2007 to September 2018, six-month moving average, seasonally adjusted

Data table for Chart 5 
Data table for chart 5
Table summary
This table displays the results of Data table for chart 5 Transition rate from employed to unemployed (left axis) and Transition rate from employed to out of labour force (right axis), calculated using percent units of measure (appearing as column headers).
Transition rate from employed to unemployed (left axis) Transition rate from employed to out of labour force (right axis)
percent
2007
January 1.43 2.40
February 1.39 2.36
March 1.39 2.34
April 1.42 2.32
May 1.41 2.31
June 1.41 2.34
July 1.41 2.38
August 1.40 2.39
September 1.39 2.40
October 1.34 2.39
November 1.33 2.37
December 1.33 2.39
2008
January 1.33 2.36
February 1.33 2.34
March 1.34 2.34
April 1.36 2.34
May 1.37 2.34
June 1.38 2.32
July 1.37 2.32
August 1.36 2.34
September 1.35 2.34
October 1.36 2.36
November 1.40 2.40
December 1.45 2.40
2009
January 1.54 2.45
February 1.61 2.45
March 1.68 2.46
April 1.73 2.44
May 1.74 2.42
June 1.73 2.40
July 1.68 2.35
August 1.65 2.33
September 1.62 2.33
October 1.58 2.32
November 1.55 2.25
December 1.56 2.26
2010
January 1.52 2.25
February 1.50 2.25
March 1.48 2.23
April 1.48 2.19
May 1.44 2.23
June 1.42 2.23
July 1.43 2.22
August 1.43 2.22
September 1.43 2.23
October 1.41 2.29
November 1.43 2.30
December 1.40 2.30
2011
January 1.38 2.31
February 1.37 2.31
March 1.36 2.30
April 1.38 2.29
May 1.35 2.31
June 1.34 2.31
July 1.31 2.34
August 1.32 2.33
September 1.34 2.31
October 1.36 2.31
November 1.37 2.29
December 1.40 2.31
2012
January 1.46 2.29
February 1.46 2.32
March 1.45 2.32
April 1.43 2.27
May 1.42 2.24
June 1.41 2.23
July 1.38 2.23
August 1.35 2.18
September 1.35 2.21
October 1.38 2.21
November 1.36 2.22
2013
December 1.36 2.18
January 1.36 2.17
February 1.36 2.15
March 1.37 2.16
April 1.35 2.18
May 1.34 2.18
June 1.39 2.21
July 1.39 2.21
August 1.39 2.23
September 1.36 2.22
October 1.35 2.20
November 1.37 2.19
December 1.33 2.19
2014
January 1.29 2.19
February 1.29 2.19
March 1.30 2.15
April 1.30 2.16
May 1.28 2.17
June 1.28 2.15
July 1.29 2.10
August 1.28 2.10
September 1.28 2.13
October 1.27 2.12
November 1.27 2.11
December 1.23 2.15
2015
January 1.22 2.19
February 1.23 2.14
March 1.22 2.12
April 1.25 2.14
May 1.25 2.13
June 1.28 2.11
July 1.27 2.09
August 1.27 2.12
September 1.28 2.11
October 1.26 2.10
November 1.26 2.10
December 1.28 2.07
2016
January 1.32 2.08
February 1.31 2.09
March 1.29 2.11
April 1.28 2.10
May 1.29 2.11
June 1.24 2.10
July 1.22 2.10
August 1.20 2.06
September 1.20 2.01
October 1.20 2.00
November 1.19 1.98
December 1.20 1.96
2017
January 1.18 1.94
February 1.17 1.96
March 1.17 2.01
April 1.17 2.02
May 1.17 2.04
June 1.16 2.05
July 1.17 2.05
August 1.18 2.05
September 1.16 2.03
October 1.15 2.03
November 1.12 1.99
December 1.10 2.00
2018
January 1.11 2.04
February 1.09 2.02
March 1.09 2.00
April 1.09 2.00
May 1.07 2.02
June 1.08 2.00
July 1.07 1.94
August 1.08 1.96
September 1.09 1.97

Both types of outflows from employment experienced a reduction during the recovery period. The number of workers becoming unemployed reached an average that was similar to what was recorded prior to the recession. Despite this decrease, the p t EU MathType@MTEF@5@5@+= feaagKart1ev2aqatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVu0Je9sqqrpepC0xbbL8F4rqqrFfpeea0xe9Lq=Jc9 vqaqpepm0xbba9pwe9Q8fs0=yqaqpepae9pg0FirpepeKkFr0xfr=x fr=xb9adbaqaaeGaciGaaiaabeqaamaabaabaaGcbaaeaaaaaaaaa8 qacaWGWbWdamaaDaaaleaapeGaamiDaaWdaeaapeGaamyraiaadwfa aaaaaa@3A14@ transition rate was higher than during the 12 months before the recession.

As for the number of workers leaving the labour force (EN), the decrease observed during the recovery period actually began during the recession. The transition rate from employed to inactive ( p t EN ) MathType@MTEF@5@5@+= feaagKart1ev2aqatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVu0Je9sqqrpepC0xbbL8F4rqqrFfpeea0xe9Lq=Jc9 vqaqpepm0xbba9pwe9Q8fs0=yqaqpepae9pg0FirpepeKkFr0xfr=x fr=xb9adbaqaaeGaciGaaiaabeqaamaabaabaaGcbaaeaaaaaaaaa8 qacaGGOaGaamiCa8aadaqhaaWcbaWdbiaadshaa8aabaWdbiaadwea caWGobaaaOWdaiaacMcaaaa@3B7F@ declined over the recovery period and was also lower than the rate observed prior to the recession.

The decline in flows out of employment over the four years following the recovery reflected the lower average EU flow, as the average EN flow increased slightly. The transition rate from employed to unemployed continued to fall in relation to the previous period, returning to a rate similar to that observed during the 12 months before the recession. On average, people who were employed had a smaller probability of becoming unemployed, compared with previous periods.

From January 2015 to February 2016, both inflows and outflows were smaller, on average, than in the previous period. Although the transition rate from employed to unemployed was lower on average than earlier periods, it did trend upwards. Therefore, an employed person had a higher chance of becoming unemployed in the subsequent month.

Chart 6 shows inflows to employment – flows from unemployed to employed (UE) and inactive to employed (NE). During the 12 months before the recession, both inflows decreased. This reduction was primarily responsible for the slight drop in the employment rate over this period.

Chart 6 Inflows to employment, January 2007 to September 2018, six-month moving average, seasonally adjusted

Data table for Chart 6 
Data table for chart 6
Table summary
This table displays the results of Data table for chart 6 Unemployed to employed (UE) and Out of labour force to employed (NE), calculated using thousands units of measure (appearing as column headers).
Unemployed to employed (UE) Out of labour force to employed (NE)
thousands
2007
January 294.88 354.67
February 291.25 351.03
March 289.59 354.15
April 286.24 354.43
May 288.75 349.38
June 290.10 353.25
July 291.23 354.75
August 289.79 355.05
September 290.73 354.77
October 287.21 361.08
November 283.69 361.88
December 282.63 358.03
2008
January 281.77 351.50
February 283.08 356.32
March 279.25 352.30
April 282.15 346.04
May 281.64 347.36
June 278.72 345.31
July 273.38 343.46
August 273.84 340.37
September 278.47 344.49
October 278.86 351.65
November 278.39 346.38
December 283.73 346.59
2009
January 288.50 346.60
February 289.83 345.10
March 290.88 342.28
April 291.35 333.58
May 300.28 335.27
June 303.14 327.71
July 311.09 323.41
August 316.85 318.63
September 319.18 316.33
October 321.32 313.81
November 320.07 317.82
December 320.85 319.78
2010
January 317.34 323.81
February 313.61 326.65
March 310.93 323.30
April 311.88 326.52
May 309.80 319.72
June 311.63 326.73
July 306.57 325.58
August 306.24 326.02
September 304.37 322.17
October 307.88 319.39
November 313.38 324.27
December 305.24 323.78
2011
January 310.51 325.91
February 309.77 324.01
March 307.93 332.82
April 305.66 338.69
May 297.43 337.70
June 298.25 336.36
July 295.91 335.12
August 293.38 341.75
September 291.91 339.34
October 289.29 336.05
November 290.43 337.28
December 292.14 341.65
2012
January 291.19 341.67
February 298.65 337.48
March 306.15 341.10
April 307.39 348.50
May 304.08 343.41
June 302.43 337.19
July 300.59 334.33
August 297.38 333.18
September 292.81 335.09
October 289.84 331.46
November 294.42 335.49
December 295.78 333.07
2013
January 300.28 334.57
February 297.30 333.12
March 294.64 327.99
April 298.19 325.84
May 298.87 325.64
June 301.52 328.98
July 302.76 326.73
August 304.49 330.04
September 305.44 329.94
October 299.54 329.67
November 296.49 329.50
December 289.15 328.10
2014
January 282.39 330.32
February 278.78 331.37
March 277.80 329.75
April 276.60 326.64
May 273.61 325.46
June 275.94 324.06
July 273.64 323.12
August 274.53 318.19
September 278.52 320.15
October 282.81 325.14
November 281.33 324.82
December 281.67 320.82
2015
January 283.42 324.86
February 277.89 328.00
March 272.71 325.89
April 273.63 322.35
May 277.28 328.15
June 277.13 333.59
July 278.01 324.50
August 281.92 325.94
September 281.08 324.75
October 281.79 322.89
November 281.56 314.28
December 281.04 315.57
2016
January 282.34 318.78
February 286.33 314.01
March 289.08 318.43
April 282.90 318.94
May 284.28 319.85
June 280.66 315.34
July 277.98 314.00
August 273.68 312.17
September 275.42 308.14
October 276.82 308.96
November 274.85 309.71
December 277.75 308.26
2017
January 282.60 309.16
February 282.19 310.35
March 280.87 313.28
April 281.67 310.37
May 284.61 313.60
June 284.64 317.31
July 281.94 319.46
August 284.69 318.57
September 278.33 318.30
October 280.02 317.75
November 278.77 317.20
December 279.72 316.52
2018
January 276.62 308.67
February 272.49 305.83
March 273.38 303.62
April 269.19 301.90
May 259.66 294.48
June 257.39 290.40
July 259.42 297.20
August 254.28 297.34
September 260.44 300.31

The number of people moving from inactivity to employment (NE) declined during the recession and remained relatively stable during the recovery period. The decrease in the NE flow may be an indication that it had been taking longer for individuals to find employment. There is normally a period of job searching before employment is found, and if this period is very short, the NU transition will not be captured. Since the LFS gathers the labour force status during the reference week, the NE transition is more likely to be captured.

During the recession, the number of unemployed finding work (UE) increased because of a composition effect due to a notable rise in the number of unemployed persons. Even though the flow increased, the probability of moving from unemployed to employed decreased (see Chart 7a). This finding was also noted in the United States.

The number of people moving from unemployment to employment (UE) fell, on average, over the four years following the recovery period, while the number of people leaving or losing their job and exiting the labour force (EN) was relatively stable.

Chart 7a Transition rates from unemployed to employed, January 2007 to September 2018, six-month moving average, seasonally adjusted

Data table for Chart 7a 
Data table for chart 7a
Table summary
This table displays the results of Data table for chart 7a Transition rate, calculated using percent units of measure (appearing as column headers).
Transition rate
percent
2007
January 26.65
February 26.41
March 26.38
April 26.23
May 26.39
June 26.65
July 26.73
August 26.73
September 26.96
October 26.79
November 26.66
December 26.53
2008
January 26.47
February 26.63
March 26.23
April 26.32
May 26.10
June 25.76
July 25.26
August 25.17
September 25.51
October 25.52
November 25.35
December 25.42
2009
January 25.20
February 24.43
March 23.35
April 22.26
May 21.86
June 21.13
July 20.87
August 20.71
September 20.57
October 20.61
November 20.48
December 20.54
2010
January 20.38
February 20.28
March 20.26
April 20.35
May 20.29
June 20.60
July 20.46
August 20.50
September 20.39
October 20.64
November 21.13
December 20.75
2011
January 21.24
February 21.31
March 21.38
April 21.42
May 20.91
June 20.99
July 20.87
August 20.89
September 20.96
October 20.91
November 21.09
December 21.18
2012
January 21.13
February 21.49
March 21.94
April 22.05
May 21.85
June 21.79
July 21.76
August 21.71
September 21.48
October 21.25
November 21.48
December 21.62
2013
January 21.90
February 21.75
March 21.59
April 21.80
May 21.98
June 22.29
July 22.40
August 22.45
September 22.49
October 22.22
November 22.04
December 21.49
2014
January 20.94
February 20.74
March 20.69
April 20.57
May 20.36
June 20.52
July 20.44
August 20.45
September 20.77
October 21.16
November 21.22
December 21.38
2015
January 21.70
February 21.53
March 21.22
April 21.30
May 21.47
June 21.37
July 21.31
August 21.47
September 21.27
October 21.16
November 21.06
December 20.87
2016
January 20.80
February 20.90
March 20.97
April 20.52
May 20.53
June 20.34
July 20.29
August 20.08
September 20.32
October 20.44
November 20.39
December 20.63
2017
January 20.93
February 20.98
March 21.07
April 21.29
May 21.75
June 21.89
July 21.91
August 22.36
September 22.08
October 22.45
November 22.47
December 22.91
2018
January 23.07
February 22.98
March 23.29
April 23.18
May 22.57
June 22.43
July 22.42
August 21.96
September 22.32

Chart 7b Transition rates from out of the labour force to employed, January 2007 to September 2018, six-month moving average, seasonally adjusted

Data table for Chart 7b 
Data table for chart 7b
Table summary
This table displays the results of Data table for chart 7b Transition rate, calculated using percent units of measure (appearing as column headers).
Transition rate
percent
2007
January 4.11
February 4.07
March 4.11
April 4.11
May 4.06
June 4.11
July 4.12
August 4.13
September 4.12
October 4.19
November 4.20
December 4.15
2008
January 4.08
February 4.13
March 4.09
April 4.02
May 4.03
June 4.00
July 3.97
August 3.93
September 3.96
October 4.03
November 3.97
December 3.96
2009
January 3.96
February 3.93
March 3.89
April 3.79
May 3.79
June 3.70
July 3.64
August 3.58
September 3.55
October 3.50
November 3.54
December 3.55
2010
January 3.59
February 3.62
March 3.57
April 3.61
May 3.53
June 3.60
July 3.59
August 3.59
September 3.55
October 3.51
November 3.55
December 3.54
2011
January 3.55
February 3.53
March 3.61
April 3.67
May 3.66
June 3.65
July 3.63
August 3.70
September 3.66
October 3.62
November 3.62
December 3.66
2012
January 3.65
February 3.60
March 3.63
April 3.70
May 3.65
June 3.58
July 3.54
August 3.52
September 3.54
October 3.50
November 3.54
December 3.51
2013
January 3.53
February 3.51
March 3.45
April 3.43
May 3.42
June 3.45
July 3.42
August 3.45
September 3.44
October 3.43
November 3.42
December 3.40
2014
January 3.42
February 3.42
March 3.40
April 3.36
May 3.34
June 3.32
July 3.30
August 3.24
September 3.25
October 3.30
November 3.29
December 3.24
2015
January 3.27
February 3.30
March 3.27
April 3.23
May 3.29
June 3.34
July 3.25
August 3.26
September 3.25
October 3.23
November 3.14
December 3.15
2016
January 3.18
February 3.13
March 3.17
April 3.17
May 3.18
June 3.13
July 3.11
August 3.08
September 3.03
October 3.04
November 3.04
December 3.03
2017
January 3.04
February 3.05
March 3.08
April 3.05
May 3.08
June 3.11
July 3.13
August 3.12
September 3.11
October 3.10
November 3.09
December 3.08
2018
January 3.00
February 2.97
March 2.94
April 2.92
May 2.84
June 2.79
July 2.85
August 2.85
September 2.87

3.2. Variations in unemployment

Chart 8 presents flows into and out of unemployment. Inflows (EU+NU) are the sum of persons moving from employed to unemployed (EU) and from not in the labour force to unemployed (NU). Outflows (UE+UN) are the sum of persons moving from unemployed to employed (UE) and from unemployed to not in the labour force (UN). The same six periods are analyzed. Note 

By definition, an increase in the number of unemployed persons is observed when inflows are greater than outflows. A decline is observed when inflows are less than outflows. Table 3, in the appendix, presents the results.

Chart 8 Unemployment, inflows to and outflows from unemployment, January 2007 to September 2018, six-month moving average, seasonally adjusted

Data table for Chart 8 
Data table for chart 8
Table summary
This table displays the results of Data table for chart 8 Inflows to unemployment (EU+NU), Outflows from unemployment (UE+UN) and Number of unemployed, calculated using thousands units of measure (appearing as column headers).
Inflows to unemployment (EU+NU) Outflows from unemployment (UE+UN) Number of unemployed
thousands
2007
January 506.05 511.67 1,104.10
February 497.25 503.84 1,100.65
March 491.91 499.84 1,097.47
April 495.26 493.81 1,097.43
May 490.85 498.04 1,090.78
June 497.94 498.49 1,089.48
July 493.84 500.85 1,084.22
August 491.18 498.64 1,078.55
September 491.13 499.17 1,072.27
October 482.95 493.04 1,063.95
November 486.87 487.43 1,065.37
December 482.23 485.02 1,064.42
2008
January 482.31 485.60 1,062.90
February 487.59 487.65 1,064.60
March 490.43 484.88 1,072.10
April 494.23 489.11 1,079.20
May 495.08 494.11 1,082.18
June 492.28 494.02 1,082.48
July 492.42 489.01 1,088.08
August 490.87 489.56 1,091.78
September 487.76 489.30 1,092.82
October 491.95 489.16 1,098.23
November 500.36 484.75 1,116.35
December 516.55 490.38 1,145.02
2009
January 538.76 499.90 1,186.17
February 560.79 503.76 1,245.65
March 579.87 518.81 1,308.85
April 592.83 530.05 1,373.92
May 601.23 542.77 1,434.72
June 607.10 553.80 1,490.48
July 604.60 567.63 1,530.25
August 601.38 582.62 1,551.63
September 594.99 590.24 1,559.23
October 590.41 589.66 1,562.53
November 590.84 593.61 1,562.43
December 586.91 594.78 1,557.10
2010
January 576.24 589.51 1,546.30
February 568.80 582.41 1,535.00
March 565.97 570.73 1,532.53
April 564.03 571.93 1,526.92
May 552.72 568.95 1,513.07
June 552.89 570.45 1,498.05
July 558.29 565.06 1,493.58
August 559.49 562.83 1,493.02
September 561.70 565.48 1,491.82
October 562.36 573.58 1,483.43
November 568.30 583.45 1,470.95
December 561.67 573.08 1,462.22
2011
January 565.40 576.82 1,453.67
February 564.29 579.97 1,440.45
March 561.82 577.74 1,427.05
April 563.16 570.25 1,422.37
May 557.42 561.58 1,420.65
June 556.17 561.42 1,417.92
July 545.19 560.95 1,404.62
August 546.07 560.66 1,392.43
September 547.07 558.37 1,383.60
October 547.94 557.01 1,376.90
November 551.32 551.40 1,379.18
December 555.73 559.18 1,377.92
2012
January 566.51 557.08 1,389.62
February 566.55 563.47 1,395.35
March 568.53 572.57 1,393.97
April 568.65 573.98 1,391.42
May 565.39 571.81 1,387.82
June 556.63 566.13 1,381.12
July 552.33 566.23 1,369.90
August 546.93 555.83 1,363.38
September 544.81 546.66 1,364.05
October 547.75 543.47 1,370.82
November 546.10 551.51 1,367.90
December 551.71 550.92 1,371.20
2013
January 547.41 554.16 1,366.88
February 546.69 551.29 1,364.70
March 548.69 547.96 1,367.67
April 541.94 552.49 1,359.55
May 538.75 548.05 1,352.62
June 545.05 548.27 1,351.75
July 547.38 545.40 1,356.20
August 546.75 547.12 1,358.33
September 536.78 549.70 1,347.78
October 535.46 540.11 1,345.28
November 541.42 543.26 1,345.58
December 538.03 537.30 1,348.35
2014
January 525.03 530.96 1,344.30
February 525.62 529.36 1,342.42
March 527.11 526.60 1,344.80
April 527.03 529.76 1,343.80
May 523.32 524.20 1,344.75
June 517.07 525.23 1,338.73
July 523.99 522.86 1,342.13
August 520.82 524.35 1,341.00
September 523.27 530.37 1,336.42
October 518.07 530.93 1,326.05
November 514.24 525.25 1,317.37
December 510.13 523.78 1,305.95
2015
January 507.46 524.72 1,290.73
February 510.07 517.24 1,285.42
March 504.83 507.32 1,284.67
April 508.51 503.48 1,291.50
May 510.60 506.77 1,297.08
June 512.63 506.51 1,304.87
July 511.79 505.11 1,313.18
August 515.80 509.14 1,321.42
September 519.07 510.42 1,331.62
October 518.28 514.61 1,336.83
November 522.33 513.98 1,346.83
December 526.76 517.28 1,357.65
2016
January 533.26 522.54 1,369.75
February 532.71 525.19 1,378.68
March 531.94 533.57 1,378.55
April 531.87 527.21 1,384.75
May 523.70 530.58 1,379.58
June 514.72 526.11 1,369.98
July 511.00 519.72 1,363.17
August 505.21 515.02 1,355.25
September 506.44 509.19 1,354.50
October 500.44 508.61 1,348.08
November 496.81 499.85 1,346.47
December 499.95 497.49 1,350.30
2017
January 495.91 502.46 1,345.03
February 487.21 500.38 1,333.15
March 482.94 494.58 1,322.72
April 480.34 495.93 1,308.50
May 486.49 496.37 1,300.05
June 482.75 497.38 1,287.02
July 478.61 494.23 1,272.97
August 481.28 495.15 1,260.85
September 476.03 491.33 1,247.20
October 478.60 486.74 1,240.80
November 471.41 492.79 1,221.18
December 465.75 489.75 1,198.97
2018
January 467.70 483.21 1,185.53
February 461.60 475.09 1,173.97
March 462.05 476.62 1,161.33
April 460.34 473.33 1,150.32
May 454.43 459.16 1,147.58
June 461.25 453.86 1,156.95
July 458.10 458.97 1,158.12
August 460.48 454.15 1,166.60
September 459.02 456.28 1,171.43

Over the 12 months before the recession, the number of unemployed persons rose, as inflows were greater than outflows (493,000 and 489,000 on average, respectively). The unemployment rate increase by 0.4 percentage points.

Inflows rose notably during the recession, the number of unemployed persons increased sharply (+460,000), and the unemployment rate rose by 2.5 percentage points. However, outflows also increased over the period, but to a lesser extent, and beginning later in the period. On average, flows into unemployment were 597,000 per month, while outflows were 548,000.

During the recovery period, outflows from unemployment were higher on average than during the recession, while inflows decreased. The greater number of people exiting unemployment, combined with the decline in entrants, reduced the total number of unemployed. This reduction continued until August 2011, when inflows and outflows returned to similar average levels.

The number of unemployed persons continued to decline during the period following the recovery (January 2011 to January 2015), but at a slower pace. Outflows and inflows both trended downwards over the four-year period, although the number of people exiting unemployment remained higher than the number entering. The unemployment rate decreased by 1.1 percentage point, reaching a low of 6.6% in January 2015.

From January 2015 to February 2016, coinciding with the oil price shock, flows into unemployment trended upwards. Outflows also increased, somewhat later in the period. Consequently, a gap formed between the number of people entering and exiting unemployment. The unemployment rate peaked at 7.2% in January and February 2016.

Following this peak, inflows to and outflows from unemployment both decreased and inflows went back to being less than outflows. The gap between the two flows widened from January 2017 to April 2018, and the unemployment rate dropped sharply to hover between 5.8% and 6.0% between December 2017 and September 2018.

3.2.1 Inflows to and outflows from unemployment and transition rates

Once again, examining inflows and outflows at a more disaggregated level allows for a better understanding of the movements that underlie the changes in flows described above. It should be noted that two of the flows related to unemployment were also discussed in the section on employment. Chart 9 shows flows into unemployment.

Chart 9 Inflows to unemployment, January 2007 to September 2018, six-month moving average, seasonally adjusted

Data table for Chart 9 
Data table for chart 9
Table summary
This table displays the results of Data table for chart 9 Out of labour force to unemployed (NU) and Employed to unemployed (EU), calculated using thousands units of measure (appearing as column headers).
Out of labour force to unemployed (NU) Employed to unemployed (EU)
thousands
2007
January 270.63 235.42
February 267.47 229.77
March 262.51 229.40
April 260.47 234.79
May 256.81 234.04
June 262.39 235.55
July 259.46 234.38
August 257.42 233.75
September 257.70 233.43
October 259.01 223.93
November 262.64 224.22
December 258.93 223.31
2008
January 258.57 223.75
February 262.80 224.79
March 264.15 226.27
April 264.37 229.85
May 262.82 232.26
June 258.23 234.05
July 259.73 232.70
August 259.28 231.60
September 259.05 228.71
October 261.40 230.55
November 262.04 238.31
December 269.74 246.81
2009
January 276.60 262.16
February 286.78 274.02
March 295.33 284.53
April 300.60 292.23
May 308.21 293.02
June 316.84 290.26
July 322.73 281.87
August 324.87 276.51
September 323.90 271.10
October 327.41 263.00
November 331.64 259.20
December 326.22 260.68
2010
January 321.33 254.91
February 316.84 251.96
March 317.09 248.88
April 315.56 248.47
May 310.23 242.50
June 313.83 239.06
July 315.87 242.42
August 317.31 242.18
September 319.63 242.07
October 322.64 239.72
November 324.96 243.34
December 322.91 238.76
2011
January 330.55 234.85
February 331.19 233.09
March 329.63 232.19
April 327.72 235.44
May 325.48 231.94
June 326.96 229.20
July 320.17 225.02
August 318.50 227.57
September 315.91 231.16
October 313.96 233.98
November 314.65 236.67
December 313.59 242.14
2012
January 314.96 251.55
February 314.31 252.24
March 318.67 249.86
April 321.25 247.40
May 319.12 246.27
June 312.82 243.81
July 312.64 239.69
August 311.93 235.01
September 308.79 236.02
October 307.59 240.16
November 308.02 238.08
December 314.42 237.30
2013
January 308.41 239.00
February 307.42 239.28
March 308.15 240.54
April 304.89 237.05
May 302.96 235.79
June 300.81 244.25
July 302.16 245.22
August 301.53 245.22
September 296.25 240.52
October 295.90 239.56
November 298.99 242.43
December 302.99 235.04
2014
January 296.58 228.46
February 296.03 229.59
March 296.16 230.95
April 297.14 229.88
May 296.33 226.99
June 290.56 226.52
July 294.88 229.11
August 293.04 227.77
September 295.90 227.37
October 292.78 225.29
November 288.37 225.87
December 290.16 219.97
2015
January 289.38 218.08
February 290.42 219.64
March 286.40 218.43
April 285.27 223.23
May 286.70 223.90
June 283.12 229.51
July 285.08 226.72
August 288.71 227.09
September 290.03 229.03
October 292.17 226.11
November 295.47 226.86
December 296.37 230.39
2016
January 295.78 237.48
February 296.95 235.75
March 299.04 232.90
April 301.51 230.36
May 292.26 231.44
June 290.66 224.06
July 290.99 220.01
August 288.59 216.62
September 289.40 217.04
October 283.61 216.84
November 282.32 214.50
December 283.40 216.55
2017
January 281.30 214.61
February 273.93 213.27
March 269.93 213.01
April 266.69 213.65
May 272.86 213.63
June 270.28 212.47
July 263.74 214.87
August 264.30 216.98
September 262.67 213.36
October 267.19 211.41
November 264.16 207.25
December 261.95 203.80
2018
January 262.86 204.84
February 260.28 201.32
March 259.53 202.52
April 257.66 202.68
May 255.47 198.96
June 259.69 201.55
July 259.91 198.19
August 258.79 201.69
September 256.37 202.65

The strong increase in the number of unemployed observed during the recession was caused by a rise in both components of the inflows. As previously mentioned, the flow from employed to unemployed increased sharply over the period. The number of people entering the labour force to look for work also rose notably. Looking at the transition rate from being inactive to unemployed, an increase over the course of the recession can be seen. Therefore, the probability of moving from inactivity to unemployment increased over this period (Chart 12).

During the recovery period, as the number of people moving from employment to unemployment dropped back to its pre-recession level, the number of people entering the labour force to look for work remained higher than the average level observed before and during the recession. This higher average NU flow dampened the declines in inflows to unemployment and the number of unemployed persons.

The fact that the NU flow increased and remained high could indicate weaker growth in employment. Chart 10 shows the share of individuals not in the labour force who entered the labour market and did not find employment during the first few weeks of job searching. In October 2008, this proportion was 41.8%, while it was 51.9% in July 2009, an increase of 10.1 percentage points.

This increase in the share of individuals not in the labour force who entered the labour market and did not find employment quickly was also observed during the recession periods in the United States. In Canada, although the share decreased during the periods following the recession, it remained greater than it had been in the 12 months before the recession.

The number of people moving from employment to unemployment rose between January 2015 and February 2016. Although the transition rate between employment and unemployment ( p t EU ) MathType@MTEF@5@5@+= feaagKart1ev2aqatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVu0Je9sqqrpepC0xbbL8F4rqqrFfpeea0xe9Lq=Jc9 vqaqpepm0xbba9pwe9Q8fs0=yqaqpepae9pg0FirpepeKkFr0xfr=x fr=xb9adbaqaaeGaciGaaiaabeqaamaabaabaaGcbaaeaaaaaaaaa8 qacaGGOaGaamiCa8aadaqhaaWcbaWdbiaadshaa8aabaWdbiaadwea caWGvbaaaOWdaiaacMcaaaa@3B86@ was lower on average during that period, the rate trended upward. This increase followed a downward trend over the previous two periods.Note  The flow of people from inactivity to unemployment also rose on average over this period, but began somewhat later. An increase in the transition rate between inactivity and unemployment ( p t NU ) MathType@MTEF@5@5@+= feaagKart1ev2aqatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVu0Je9sqqrpepC0xbbL8F4rqqrFfpeea0xe9Lq=Jc9 vqaqpepm0xbba9pwe9Q8fs0=yqaqpepae9pg0FirpepeKkFr0xfr=x fr=xb9adbaqaaeGaciGaaiaabeqaamaabaabaaGcbaaeaaaaaaaaa8 qacaGGOaGaamiCa8aadaqhaaWcbaWdbiaadshaa8aabaWdbiaad6ea caWGvbaaaOWdaiaacMcaaaa@3B8F@ was also observed. These changes in the gross flows and transition rates coincided with the oil price shock.

Over the more recent period, both components of the inflows to unemployment decreased, but the decline was less notable than that observed for the outflows.

Chart 10 Flows from inactive to unemployment as a proportion of labour market entrants [NU/(NU+NE)], January 2007 to September 2018, six-month moving average, seasonally adjusted

Data table for Chart 10 
Data table for chart 10
Table summary
This table displays the results of Data table for chart 10 [NU/(NU+NE)], calculated using percent units of measure (appearing as column headers).
[NU/(NU+NE)]
percent
2007
January 43.28
February 43.25
March 42.57
April 42.36
May 42.37
June 42.62
July 42.24
August 42.03
September 42.08
October 41.77
November 42.06
December 41.97
2008
January 42.38
February 42.45
March 42.85
April 43.31
May 43.07
June 42.79
July 43.06
August 43.24
September 42.92
October 42.64
November 43.07
December 43.77
2009
January 44.38
February 45.38
March 46.32
April 47.40
May 47.90
June 49.16
July 49.95
August 50.48
September 50.59
October 51.06
November 51.06
December 50.50
2010
January 49.81
February 49.24
March 49.51
April 49.15
May 49.25
June 48.99
July 49.24
August 49.32
September 49.80
October 50.25
November 50.05
December 49.93
2011
January 50.35
February 50.55
March 49.76
April 49.18
May 49.08
June 49.29
July 48.86
August 48.24
September 48.21
October 48.30
November 48.26
December 47.86
2012
January 47.97
February 48.22
March 48.30
April 47.97
May 48.17
June 48.13
July 48.32
August 48.35
September 47.96
October 48.13
November 47.87
December 48.56
2013
January 47.97
February 47.99
March 48.44
April 48.34
May 48.20
June 47.76
July 48.05
August 47.74
September 47.31
October 47.30
November 47.57
December 48.01
2014
January 47.31
February 47.18
March 47.32
April 47.64
May 47.66
June 47.27
July 47.72
August 47.94
September 48.03
October 47.38
November 47.03
December 47.49
2015
January 47.11
February 46.96
March 46.78
April 46.95
May 46.63
June 45.91
July 46.77
August 46.97
September 47.18
October 47.50
November 48.46
December 48.43
2016
January 48.13
February 48.60
March 48.43
April 48.60
May 47.75
June 47.96
July 48.10
August 48.04
September 48.43
October 47.86
November 47.69
December 47.90
2017
January 47.64
February 46.88
March 46.28
April 46.22
May 46.53
June 46.00
July 45.22
August 45.34
September 45.21
October 45.68
November 45.44
December 45.28
2018
January 45.99
February 45.98
March 46.09
April 46.05
May 46.45
June 47.21
July 46.65
August 46.53
September 46.05

In terms of flows out of unemployment (Chart 11), the number of unemployed who left the labour force in the following month (UN) started to increase after the recession period began. It is well documented in the literature that many different factors may have contributed to this rise in the UN flow. For example, job seekers who stopped searching when faced with less than ideal job prospects, or individuals who returned to school.

Chart 11 Outflows from unemployment, January 2007 to September 2018, six-month moving average, seasonally adjusted

Data table for Chart 11 
Data table for chart 11
Table summary
This table displays the results of Data table for chart 11 Unemployed to employed (UE) and Unemployed to out of labour force (UN), calculated using thousands units of measure (appearing as column headers).
Unemployed to employed (UE) Unemployed to out of labour force (UN)
thousands
2007
January 294.88 216.80
February 291.25 212.59
March 289.59 210.25
April 286.24 207.57
May 288.75 209.29
June 290.10 208.39
July 291.23 209.62
August 289.79 208.85
September 290.73 208.44
October 287.21 205.84
November 283.69 203.74
December 282.63 202.39
2008
January 281.77 203.84
February 283.08 204.57
March 279.25 205.64
April 282.15 206.96
May 281.64 212.47
June 278.72 215.30
July 273.38 215.63
August 273.84 215.72
September 278.47 210.83
October 278.86 210.30
November 278.39 206.36
December 283.73 206.66
2009
January 288.50 211.39
February 289.83 213.93
March 290.88 227.94
April 291.35 238.70
May 300.28 242.49
June 303.14 250.66
July 311.09 256.53
August 316.85 265.76
September 319.18 271.07
October 321.32 268.34
November 320.07 273.54
December 320.85 273.93
2010
January 317.34 272.16
February 313.61 268.79
March 310.93 259.80
April 311.88 260.05
May 309.80 259.15
June 311.63 258.83
July 306.57 258.49
August 306.24 256.59
September 304.37 261.11
October 307.88 265.70
November 313.38 270.07
December 305.24 267.84
2011
January 310.51 266.31
February 309.77 270.20
March 307.93 269.81
April 305.66 264.59
May 297.43 264.15
June 298.25 263.17
July 295.91 265.05
August 293.38 267.28
September 291.91 266.47
October 289.29 267.72
November 290.43 260.96
December 292.14 267.04
2012
January 291.19 265.89
February 298.65 264.82
March 306.15 266.42
April 307.39 266.60
May 304.08 267.72
June 302.43 263.70
July 300.59 265.64
August 297.38 258.44
September 292.81 253.85
October 289.84 253.63
November 294.42 257.10
December 295.78 255.14
2013
January 300.28 253.88
February 297.30 253.99
March 294.64 253.31
April 298.19 254.31
May 298.87 249.18
June 301.52 246.76
July 302.76 242.64
August 304.49 242.63
September 305.44 244.26
October 299.54 240.56
November 296.49 246.77
December 289.15 248.15
2014
January 282.39 248.57
February 278.78 250.58
March 277.80 248.81
April 276.60 253.15
May 273.61 250.59
June 275.94 249.29
July 273.64 249.23
August 274.53 249.83
September 278.52 251.85
October 282.81 248.12
November 281.33 243.92
December 281.67 242.10
2015
January 283.42 241.30
February 277.89 239.36
March 272.71 234.61
April 273.63 229.85
May 277.28 229.49
June 277.13 229.39
July 278.01 227.11
August 281.92 227.22
September 281.08 229.33
October 281.79 232.82
November 281.56 232.42
December 281.04 236.24
2016
January 282.34 240.20
February 286.33 238.86
March 289.08 244.48
April 282.90 244.31
May 284.28 246.31
June 280.66 245.45
July 277.98 241.74
August 273.68 241.33
September 275.42 233.77
October 276.82 231.79
November 274.85 225.00
December 277.75 219.74
2017
January 282.60 219.87
February 282.19 218.19
March 280.87 213.71
April 281.67 214.26
May 284.61 211.76
June 284.64 212.74
July 281.94 212.29
August 284.69 210.46
September 278.33 213.00
October 280.02 206.72
November 278.77 214.02
December 279.72 210.03
2018
January 276.62 206.60
February 272.49 202.61
March 273.38 203.24
April 269.19 204.14
May 259.66 199.50
June 257.39 196.47
July 259.42 199.55
August 254.28 199.87
September 260.44 195.84

Looking at the UN transition rate ( p t UN ) MathType@MTEF@5@5@+= feaagKart1ev2aqatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVu0Je9sqqrpepC0xbbL8F4rqqrFfpeea0xe9Lq=Jc9 vqaqpepm0xbba9pwe9Q8fs0=yqaqpepae9pg0FirpepeKkFr0xfr=x fr=xb9adbaqaaeGaciGaaiaabeqaamaabaabaaGcbaaeaaaaaaaaa8 qacaGGOaGaamiCa8aadaqhaaWcbaWdbiaadshaa8aabaWdbiaadwfa caWGobaaaOWdaiaacMcaaaa@3B8F@ , a decline can be seen through the recession. Consequently, the probability of moving from unemployed to not in the labour force decreased during these periods. It is therefore difficult to determine if part of the increase in the UN flow was a composition effect caused by the rise in the number of unemployed persons or by the increase in the number of discouraged searchers.

Chart 12 Transition rates from out of the labour force to unemployed, January 2007 to September 2018, six-month moving average, seasonally adjusted

Data table for Chart 12 
Data table for chart 12
Table summary
This table displays the results of Data table for chart 12 Transition rate, calculated using percent units of measure (appearing as column headers).
Transition rate
percent
2007
January 3.14
February 3.10
March 3.04
April 3.02
May 2.98
June 3.05
July 3.02
August 2.99
September 2.99
October 3.00
November 3.05
December 3.00
2008
January 3.00
February 3.05
March 3.07
April 3.07
May 3.05
June 2.99
July 3.00
August 2.99
September 2.98
October 3.00
November 3.00
December 3.08
2009
January 3.16
February 3.27
March 3.36
April 3.41
May 3.49
June 3.58
July 3.64
August 3.65
September 3.63
October 3.66
November 3.69
December 3.63
2010
January 3.56
February 3.51
March 3.51
April 3.49
May 3.43
June 3.46
July 3.48
August 3.50
September 3.52
October 3.55
November 3.56
December 3.53
2011
January 3.60
February 3.60
March 3.58
April 3.56
May 3.53
June 3.55
July 3.47
August 3.44
September 3.41
October 3.38
November 3.38
December 3.36
2012
January 3.37
February 3.35
March 3.39
April 3.41
May 3.39
June 3.32
July 3.31
August 3.30
September 3.26
October 3.25
November 3.25
December 3.31
2013
January 3.25
February 3.24
March 3.25
April 3.21
May 3.18
June 3.15
July 3.16
August 3.15
September 3.09
October 3.08
November 3.10
December 3.14
2014
January 3.07
February 3.06
March 3.05
April 3.05
May 3.04
June 2.97
July 3.01
August 2.99
September 3.01
October 2.97
November 2.92
December 2.93
2015
January 2.92
February 2.92
March 2.88
April 2.86
May 2.87
June 2.84
July 2.86
August 2.89
September 2.90
October 2.92
November 2.96
December 2.96
2016
January 2.95
February 2.96
March 2.98
April 3.00
May 2.90
June 2.88
July 2.88
August 2.85
September 2.85
October 2.79
November 2.77
December 2.78
2017
January 2.76
February 2.69
March 2.66
April 2.62
May 2.68
June 2.65
July 2.59
August 2.59
September 2.57
October 2.61
November 2.58
December 2.55
2018
January 2.56
February 2.53
March 2.51
April 2.49
May 2.46
June 2.50
July 2.49
August 2.48
September 2.45

During the recovery and the subsequent four years, the number of job searchers who stopped searching (UN) was higher than the average level observed over the 12 months prior to the recession. Nevertheless, the UN flow did trend downwards over the period. This trend persisted until the summer of 2015.

The increase in the flows out of unemployment observed between January 2015 and February 2016 stemmed primarily from the rise in the number of unemployed leaving the labour force. However, this increase did not last long, as the flow began to diminish notably beginning in the summer of 2016.

3.2.2 Long-term unemployment

During periods of economic shocks, such as recessions, the number of long-term unemployed increases. The number of unemployed who remain so in the following month can be seen in the gross flows. Chart 13 presents the transition rates for this flow.

The proportion of the unemployed who remain unemployed (UU transition rate) increased notably over the recession and remained high thereafter. Over this period, the proportion of the unemployed who had been looking for work for 27 weeks or more also increased markedly.

The probability of remaining unemployed over two consecutive months fell over the recovery period, and this reduction persisted until the summer of 2012. However, this proportion remained higher that what had been observed before the recession. This was also true for the proportion of people who had been looking for work for 27 weeks or more.

The proportion of the unemployed who remained unemployed rose between January 2015 and January 2017. At this point, the transition rate was similar to that observed during the recession. The rate subsequently trended downwards, as did the proportion of long-term unemployed. From the spring of 2018, the transition rate began to rise, which was not the case for the share of unemployed who had been searching for 27 weeks or more.

Chart 13 Proportion of unemployed who stayed unemployed (transition rate), January 2007 to September 2018, six-month moving average, seasonally adjusted

Data table for Chart 13 
Data table for chart 13
Table summary
This table displays the results of Data table for chart 13 Transition rate, calculated using percent units of measure (appearing as column headers).
Transition rate
percent
2007
January 53.72
February 54.27
March 54.43
April 54.71
May 54.45
June 54.17
July 53.99
August 53.97
September 53.68
October 53.99
November 54.15
December 54.44
2008
January 54.35
February 54.09
March 54.43
April 54.35
May 54.19
June 54.33
July 54.80
August 54.99
September 55.16
October 55.22
November 55.84
December 56.05
2009
January 56.32
February 57.51
March 58.33
April 59.48
May 60.47
June 61.38
July 61.90
August 61.91
September 61.94
October 62.17
November 61.99
December 61.92
2010
January 62.12
February 62.32
March 62.80
April 62.66
May 62.72
June 62.28
July 62.26
August 62.30
September 62.11
October 61.53
November 60.65
December 61.02
2011
January 60.53
February 60.08
March 59.87
April 60.02
May 60.50
June 60.46
July 60.42
August 60.07
September 59.88
October 59.72
November 59.94
December 59.44
2012
January 59.55
February 59.44
March 58.95
April 58.81
May 58.89
June 59.20
July 58.99
August 59.42
September 59.89
October 60.15
November 59.76
December 59.72
2013
January 59.57
February 59.65
March 59.83
April 59.58
May 59.67
June 59.45
July 59.63
August 59.64
September 59.51
October 59.91
November 59.60
December 60.05
2014
January 60.60
February 60.60
March 60.75
April 60.59
May 60.97
June 60.92
July 60.92
August 60.91
September 60.43
October 60.25
November 60.37
December 60.22
2015
January 59.80
February 59.90
March 60.51
April 60.79
May 60.74
June 60.93
July 61.27
August 61.21
September 61.35
October 61.34
November 61.53
December 61.57
2016
January 61.49
February 61.63
March 61.28
April 61.73
May 61.66
June 61.84
July 62.04
August 62.19
September 62.40
October 62.43
November 62.90
December 63.03
2017
January 62.76
February 62.77
March 62.87
April 62.48
May 62.03
June 61.71
July 61.57
August 61.07
September 61.00
October 60.94
November 60.26
December 59.87
2018
January 59.66
February 59.89
March 59.36
April 59.20
May 60.04
June 60.41
July 60.29
August 60.75
September 60.85

4. Conclusion

This analysis shows that knowing the origin and destination statuses of the people moving in the labour market provides a more complete picture of the situation and contributes to a better understanding of labour market dynamics in Canada, which can in turn help guide policy development.

The Canadian labour market is very dynamic, with 6.2% of the working-age population, on average, having changed their labour force status each month between January 2007 and September 2018. However, this percentage has decreased over time, as more people remain in the same labour force status from one month to the next.

The movements in the data are clearly observable during economic shocks. The sharp decrease in employment observed during the 2008/2009 recession was mainly attributable to the increase in outflows from employment, while inflows remained relatively stable. This increase in flows out of employment occurred mainly as a result of the increase in flows from employment to unemployment, possibly caused by layoffs over the period. The notable increase in the number of unemployed observed during the recession was caused by a rise in both components of the inflows to unemployment.

The proportion of unemployed who stayed unemployed the next month increased notably over the 2008/2009 recession, and remained higher compared with what was observed over the 12 months before the recession.

This analysis has also paved the way for several possible research projects in the future. For example, do gross flows behave similarly in the larger regions? What gender or age differences can be seen in terms of gross flows? Are the cyclical aspects of the flows similar to previous recessions?

Appendix 1: Tables

Table 1
Average gross flows in level and in proportion of the working age population
Table summary
This table displays the results of Average gross flows in level and in proportion of the working age population. The information is grouped by Averages from October 2007 to September 2018 (appearing as row headers), Labour force status current month (t+1), Gross flows (thousands) and Proportion of the population adged 15 and over (%) (appearing as column headers).
Averages from October 2007 to September 2018 Labour force status current month ( t+1 MathType@MTEF@5@5@+= feaagKart1ev2aaatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVu0Je9sqqrpepC0xbbL8F4rqqrFfpeea0xe9Lq=Jc9 vqaqpepm0xbba9pwe9Q8fs0=yqaqpepae9pg0FirpepeKkFr0xfr=x fr=xb9adbaqaaeGaciGaaiaabeqaamaabaabaaGcbaaeaaaaaaaaa8 qacaWG0bGaey4kaSIaaGymaaaa@38AC@ )
Employed Unemployed Inactive Employed Unemployed Inactive
gross flows (thousands) proportion of the population aged 15 and over (%)
Labour force status previous month ( t MathType@MTEF@5@5@+= feaagKart1ev2aqatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLn hiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr 4rNCHbGeaGqiVu0Je9sqqrpepC0xbbL8F4rqqrFfpeea0xe9Lq=Jc9 vqaqpepm0xbba9pwe9Q8fs0=yqaqpepae9pg0FirpepeKkFr0xfr=x fr=xb9adbaqaaeGaciGaaiaabeqaamaabaabaaGcbaaeaaaaaaaaa8 qacaWG0baaaa@3710@ )
Employed 16,958 233 384 59.5 0.8 1.3
Unemployed 289 802 239 1.0 2.8 0.8
Inactive 326 294 8,928 1.1 1.0 31.3
Table 2
Employment and employment rate changes and average employment gross flows
Table summary
This table displays the results of Employment and employment rate changes and average employment gross flows October 2007 to October 2008, October 2008 to July 2009, July 2009 to January 2011, January 2011 to January 2015, January 2015 to February 2016 and February 2016 to September 2018, calculated using Average over the period (thousands) units of measure (appearing as column headers).
October 2007 to October 2008 October 2008 to July 2009 July 2009 to January 2011 January 2011 to January 2015 January 2015 to February 2016 February 2016 to September 2018
Change in employment (thousands) 194 -426 469 731 123 696
Change in the employment rate (percentage points) -0.1 -2.2 0.5 -0.5 -0.2 0.4
average over the period (thousands)
Inflows (UE+NE) 629 629 637 623 603 584
UE 281 302 311 291 282 274
NE 349 326 325 331 321 310
Outflows (EU+EN) 629 691 625 623 608 579
EU 230 287 244 235 232 210
EN 399 405 381 388 376 369
Table 3
Unemployment and unemployment rate changes and average unemployment gross flows
Table summary
This table displays the results of Unemployment and unemployment rate changes and average unemployment gross flows October 2007 to October 2008, October 2008 to July 2009, July 2009 to January 2011, January 2011 to January 2015, January 2015 to February 2016 and February 2016 to September 2018, calculated using Average over the period (thousands) units of measure (appearing as column headers).
October 2007 to October 2008 October 2008 to July 2009 July 2009 to January 2011 January 2011 to January 2015 January 2015 to February 2016 February 2016 to September 2018
Change in unemployment (thousands) 75 460 -143 -171 137 -234
Change in the unemployment rate (percentage points) 0.4 2.5 -1 -1.1 0.6 -1.3
average over the period (thousands)
Inflows (EU+NU) 493 597 567 539 524 478
EU 230 287 244 235 232 210
NU 263 310 323 305 293 269
Outflows (UE+UN) 489 548 577 545 515 488
UE 281 302 311 291 282 274
UN 209 246 266 254 234 214
Table 4
Transition rate between labour force statuses
Table summary
This table displays the results of Transition rate between labour force statuses October 2007 to October 2008, October 2008 to July 2009, July 2009 to January 2011, January 2011 to January 2015, January 2015 to February 2016 and February 2016 to September 2018, calculated using Averages in percentage (%) units of measure (appearing as column headers).
October 2007 to October 2008 October 2008 to July 2009 July 2009 to January 2011 January 2011 to January 2015 January 2015 to February 2016 February 2016 to September 2018
averages in percentage (%)
pEE 96.28 95.87 96.28 96.43 96.60 96.83
pEU 1.36 1.70 1.45 1.34 1.29 1.14
pEN 2.35 2.41 2.26 2.21 2.09 2.01
pUE 25.91 21.74 20.69 21.39 21.09 21.70
pUU 54.79 60.57 61.65 59.93 61.40 61.34
pUN 19.27 17.67 17.64 18.66 17.49 16.93
pNE 4.03 3.69 3.58 3.47 3.21 3.02
pNU 3.03 3.51 3.55 3.19 2.93 2.62
pNN 92.75 92.62 92.69 93.16 93.67 94.17

References

Campolieti, M. 2009. "Ins and outs of unemployment in Canada, 1976-2008." Canadian Journal of Economics. Vol. 44, no. 4.

Chan, P. C. W., Morissette, R. and Frenette, M. 2011. "Workers Laid-off During the Last Three Recessions: Who Where They, and How Did They Fare?" Analytical Studies Branch Research Paper Series. No. 337. Statistics Canada Catalogue no. 11F0019M.

Davis, S. J., Faberman, R. J. and Haltiwanger, J. 2006. "The flow approach to labor markets: new data sources and micro–macro links: Some Questions and Answers." Journal of Economic Perspectives. Vol. 20, no. 3.

Frazis, H.J., Robinson, E.L., Evans, T.D. and Duff, M.A. 2005. "Estimating gross flows consistent with stocks in the CPS." Monthly Labor Review. Vol. 128, no. 9.

Frazis, H.J. and R. E. Ilg. 2009. "Trends in labour force flows during recent recessions." Monthly Labor Review. Vol. 132, no. 4.

Gomes, P. 2009. “Labour market flows: Facts from the United Kingdom.” Labour Economics. Vol. 19, issue 2.

Hasan, A. and P. De Broucker. 1985. Chômage et dynamique du marché du travail au Canada. Economic Council of Canada.

Jones, S. 1993. "Cyclical and Seasonal Properties of Canadian Gross Flows of Labour." Canadian Public Policy. Vol. 19, no. 1.

Mayer, Francine, Paul-Martel Roy, Isabel Maldonado and Laurent Pilotto. 1985. "Aspects dynamiques de la structure du chômage au Québec." L'actualité économique. Vol. 61, no. 2.

Sahin, A., Song, J. and Hobijn, B. 2010. "The unemployment gender gap during the 2007 recession." Federal Reserve Bank of New York: Current Issues in Economics and Finance. Vol. 16, no. 2.

Silverstone, B. and Bell, W. 2001. "Gross Labour Market Flows in New Zealand: Some Questions and Answers." University of Waikato, Department of Economics. Working Paper in Economics 15/11.

Sutton, A. 2012. "On the determinants of UK unemployment and the Great Recession: analysing the gross flows data." Applied Economics. Vol. 45, no. 25.

Date modified: