It’s day 87 since Canada’s 100th coronavirus case. The number of cases is 94,327 as of publication time, up 601 since yesterday—a 17 per cent decrease from the seven-day prior average of new cases. On their respective 87th day, U.S. daily new cases were up four per cent from the seven-day prior average; the U.K. was down 25 per cent in daily new cases from the seven-day prior; and in Italy, new cases were down six per cent.*
A modest recovery: Employment in Canada increased by 290,000 in May according to Statistics Canada’s Labour Force Survey (LFS), released Friday. The 1.8 per cent gain follows consecutive record drops amid the COVID-19 pandemic. The unemployment rate still rose, to 13.7 per cent—the highest since the modern LFS began in 1976—but the increase was driven by people starting to look for work, rather than being thrown out of it.
Economists took a mixed view of Friday’s numbers. Their “believability hinges upon what happens to the [2.74 million] Canadians who said they thought they had a job but didn’t work,” wrote Derek Holt, Scotiabank’s head of capital market economics. Some of those hourless employees won’t get back the schedules they had pre-pandemic, and some won’t return to their jobs at all, he noted. Trevin Stratton, chief economist at the Canadian Chamber of Commerce, called the figures “terrible and positive at the same time,” labelling them “Schrodinger’s labour market.” The strength of Canada’s economic recovery will depend on how quickly workers in different industries and different parts of the country can get back to their jobs, he said.
May’s employment gains weren’t spread equally across Canada. Provinces that have reopened their economies quicker or had fewer coronavirus cases to begin with saw larger increases. Job gains in Quebec made up nearly 80 per cent of the national total; the government let construction resume in April, and allowed retail and manufacturing firms outside Montreal back into their facilities in the first week of May. Ontario was the only province that lost further ground, but the LFS may be missing some gains—the survey was conducted between May 10 and 16, while the government only allowed non-mall stores and some recreational businesses to get going after Victoria Day.
While significantly more women than men lost jobs in the pandemic’s first month, the numbers evened out in the second. But men picked up work twice as fast as women in May, leaving the latter’s employment figures worse off among all age groups compared to February. As of May, 1.26 million prime working-age women had lost their jobs, while employment among men had fallen by 925,000.
Employment is also recovering faster at companies making things than those offering services. Construction and manufacturing saw significant gains in May (6.28 per cent and 5.50 per cent month over month, respectively), while accommodation and food services posted a pack-leading 6.82 per cent increase. But the hospitality sector remains the hardest hit over the length of the pandemic.
Knowledge workers have largely avoided the pandemic’s worst economic effects. As The Logic’s analysis last month showed, employment among innovation economy professionals has proven relatively resilient. Another 5,900 software developers, engineers and others working in similar roles lost their jobs in May, but the number in work across those fields remains much closer to what it was three months ago than for the economy as a whole. Among professional occupations, health-care workers besides nurses have unsurprisingly done best, with employment up 7.68 per cent compared to February; business and finance also increased.
U.S. employment also rose in May, adding 2.5 million jobs, the largest monthly gain since at least 1939. The results similarly defied expectations, with economists estimating an eight million job loss in May instead of the increase. It’s not all good news. About two-fifths of the new jobs in May are part time. Unemployment is officially at 13.3 per cent but would actually be 16.1 per cent if employers had not misclassified some workers
In the markets: All major North American indices jumped on the surprising employment numbers. The Dow rose most, up over 800 points at close. The S&P 500’s rise Friday put it almost even on the year, rebounding 45 per cent since its lowest point on March 23. The TSX closed up 2.10 per cent to hit 15,854, a level last seen in early March.
The benchmark Stoxx Europe 600 rose 2.48 per cent after Germany adopted its second pandemic stimulus package. OPEC nations agreed to extend oil cuts for another month, pushing Brent crude oil to its highest price since March. The Canadian dollar also jumped on the news, up 0.41 per cent to 74.32 cents U.S. in late afternoon trading, a level not seen since early March.
Cruise operator Carnival PLC and airlines Lufthansa and easyJet are being removed from blue-chip stock indexes in Europe, in a sign of which stocks are seen as the most valuable during the pandemic. A similar rejig will happen with the S&P 500 on June 22. Meanwhile, Japan’s long-term borrowing costs hit their highest rate in a year, and the British and French central banks called for governments to rebuild their economies with climate change in mind.
“It’s our humanity that is actually bringing us toward the virus. You have to take away a bit of humanity, to become a bit antisocial, to protect humanity”: In a study on social distancing, Massimo Marchiori, an Italian computer scientist who has studied how the movement of cows impacted the quality of milk they produced, found that wearing masks keeps pathogens out—and people apart.
Cross-country checkup: Canada’s mining industry has helped proliferate the spread of COVID-19, according to a report from a group of international non-profits that found 4,000 mine workers in 18 countries tested positive for the virus. Of the 69 sites with serious outbreaks, a third were run by companies headquartered in Canada. Modelling from the Public Health Agency of Canada shows new cases of COVID-19 could rise by as much as 15 per cent by mid-June. In B.C., where the number of new cases is steadily declining, residents can increase their level of contact with others to 50 to 60 per cent of what it was pre-pandemic.
Bay Street to Main Street: Ottawa is postponing the auction for 5G spectrum by six months to give telecoms the ability to focus on keeping Canadians connected during the pandemic. The 3,500 MHz auction will now start on June 15, 2021. The delay follows similar ones by France, Austria, Portugal, Spain and Denmark. The move comes days after Bell sold 25 data centres for $1.04 billion to build up its cash reserves in advance of the auction, after not winning any licences in the April 2019 5G auction. That auction brought in $3.47 billion for the government, and it’s possible this one will be even more lucrative, since it’s a band used in dense urban centres for applications like self-driving cars. Ottawa is not giving telecoms a reprieve on pricing for consumers. The federal government said Friday it’s forging ahead with a plan to make major telecoms lower their prices by 25 per cent, and will provide an update next month on that progress.
- Montreal-based Bombardier is permanently laying off 2,500 people in its aviation division as it anticipates reduced demand for business jets.
- Alternative asset manager Onex raised US$765 million by selling shares in data firm Clarivate.
- Insurance firms are raising premiums for companies with higher levels of personal contact and therefore potentially more risk of spreading COVID-19.
- Workers in Kamloops, B.C. have started constructing their part of the Trans Mountain pipeline, a major step in getting the federal government-owned project from Edmonton to Burnaby.
In the lab: China is behind five of the 10 vaccine candidates being tested on people worldwide as it races to be the first to deliver a cure. The U.S. sent almost 500,000 doses of remdesivir to states in May, but it wasn’t enough: hospitalized patients outnumbered the supply by a ratio of more than two-to-one. British pharma giant AstraZeneca has the capacity to produce two billion doses of the potential vaccine it is developing with Oxford University. Sun Pharmaceutical Industries, India’s largest drugmaker, has started a clinical trial of a plant-based COVID-19 drug. Scientists in the Netherlands have found a link between COVID-19 deaths and Vitamin K deficiency.
Some scientists say the pandemic may change the nature of drug trials forever to include increased collaboration between governments, companies and academia, which may speed up the process. At the moment, 10 of the 155 COVID-19 vaccines being researched have made it to small trials in volunteers. Here is a table tracking what stage each vaccine development proposal has reached.
Meanwhile, Singapore is developing a wearable contact-tracing device that can be attached to the end of a lanyard or carried in a handbag. The development comes after its TraceTogether app, which has been downloaded by 1.5 million people out of the country’s 5.7 million (or 26 per cent of the population), had glitches. Contact-tracing apps don’t need 60 per cent adoption to be effective, say the researchers at the University of Oxford who originally published the statistic; they can have “a protective effect” at “much lower levels.” In the wake of this, Canadian government officials are divided on whether apps should be mandatory or optional.
Drinking from the firehose:
- Clothing chain Gap has negotiated “fair rent” agreements with its landlords, as it reopens more than 1,500 of its 2,600 North America retail stores that were closed because of the pandemic.
- Thousands of workers in the U.S. risk being fired for refusing to return to work in what they consider unsafe conditions.
- Consumers have started shopping again and paying off their credit cards, according to the CEO of Synchrony Financial, the lender behind many store-brand credit cards.
- Apple is offering staff COVID-19 nasal-swab tests and checking temperatures as employees return to work.
- Slack and Amazon employees are now using each other’s technologies to improve their remote-working arrangements. However, Slack has so far not seen its growth accelerate with the work-from-home boom.
- Amazon reversed its ban on a book that denounced COVID-19 lockdowns after critics, including Tesla CEO Elon Musk, called the decision censorship.
Around the world: Matchmaking agencies in Japan have reported a surge in inquiries amid the pandemic. Taiwan has created a “humor for rumor” campaign to stop coronavirus misinformation. Turkey President Tayyip Erdoğan has cancelled a weekend lockdown after public backlash. India will open malls, restaurants and places of worship next week under strict rules. France will make €1 billion available to support apprenticeships. As part of its bailout package for startups, the French government has also created a €150-million fund to invest in local companies approached by foreign investors. The Netherlands hasn’t imposed a single day of strict lockdown because the Dutch followed the rules.
Nip/Tuck/Prune: The best way to socially distance and make money is to become a tree surgeon in London. – Murad, Fatima, Catherine & Zane
* We’re emphasizing new cases, rather than running totals, because “flattening the curve” is when each day’s new cases are fewer than those of the previous day. The percentage increase is determined based on how today’s cases compare to a rolling seven-day prior average. Numbers may also vary based on countries’ individual testing capacity and reporting.