Canadian Manufacturing

Canadian unemployment rate to peak at 11% in Q2: OECD outlook

Jobs should return as lockdowns end

July 8, 2020  The Canadian Press

OTTAWA — The Organization for Economic Co-operation and Development says the unemployment rate in Canada peaked in the second quarter of this year, topping the mark hit in the financial crisis.

In a forecast released July 7, the organization says the Canadian unemployment rate is projected to have peaked at 11% in the quarter ended June 30, surpassing the previous peak of 8.7% for the third quarter of 2009.

It says jobs should return as lockdowns end, but it still expects an unemployment rate of 7.7% by the end of 2021 in a single-hit scenario and 8.4% if there is a second wave of infections.

The report said the average unemployment rate among the OECD countries could rise as high as 12.6% in the fourth quarter of this year in a double-hit scenario.

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Under the single-hit scenario, the average unemployment rate would hit 11.4% in the second quarter of this year before declining to 9.4% in the fourth quarter.

That’s up from 5.3% in the fourth quarter of 2019 before the pandemic froze the global economy.