Economic impact of the COVID-19 pandemic in Canada

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Economic impact of the COVID-19 pandemic in Canada

Map showing real GDP growth rates in 2020, as projected by the International Monetary Fund (IMF).
Date	March 2020–present
Type	Global recession
Cause	COVID-19 pandemic-induced market instability and lockdown
Outcome	Sharp rise in unemployment Stress on supply chains Decrease in government income Collapse of the Travel, Tourism & Hospitality industry Reduced consumer activity

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The COVID-19 pandemic had a deep impact on the Canadian economy, leading it into a recession. The government's social distancing rules had the effect of limiting economic activity in the country. Companies started mass layoffs of workers, and Canada's unemployment rate was 13.5 percent in May 2020, the highest it has been since 1976.^[1]

Many large-scale events that planned to take place in 2020 in Canada were cancelled or delayed. This includes all major sporting and artistic events.^[2] Canada's tourism and air travel sectors were hit especially hard due to travel restrictions.^[3] Some farmers feared a labour shortfall and bankruptcy.^[4]

The pandemic affected consumer behaviours. In the early stages of the pandemic, Canadian grocery stores were the site of large-scale panic buying which led to many empty shelves. By the end of March 2020, most stores were closed to walk-in customers with the exception of grocery stores and pharmacies, which implemented strong social distancing rules in their premises. These rules were also implemented in other Canadian businesses as they began to re-open in the following months.

By October 2021, employment levels recovered to levels last seen in February 2020 (prior to the pandemic), but gains were primarily concentrated within part-time job growth, especially part-time positions typically occupied by women. Approximately 100,000 fewer men held a full-time position, relative to pre-pandemic levels.^[5] Overall, there remained 400,000 fewer jobs relative to pre-pandemic trend line.^[6]