July 2020 Economic Brief

For a sixth consecutive month…

Employment is down sharply and unemployment is up in the Greater Regina Area. Pandemic related job losses are expected to continue through the summer of 2020 with more layoffs/permanent furloughs and with more students entering a weak summer job market. Construction activity is bouncing back in the first 5 months of 2020 after a very weak 2019 with gains in housing starts and, although slowing, building permits. Construction activity, not mirrored in the employment data, is also a reflection of pent up demand.

• Total employment in the Greater Regina Area was down -8.5% or -12,083 positions in January to June 2020 over the same period in 2019. At the provincial level, year-to-date employment decreased by -33,833 or -5.9%. These losses occurred largely in full time positions (-10,100). Part time employment dropped slightly by 2,000 positions. Month-to-month (June 2019 to June 2020) saw employment drop by 22,400 as government interventions related to COVID-19 continue to impact the local economy. Job losses are expected to continue through the summer of 2020 as temporary layoffs move towards permanent furloughs.
• Year-to-date employment in June 2020 was up over the same period in 2019 in Finance, insurance, real estate and leasing (633), Professional, scientific and technical services (683), Information, culture and recreation (567), other services (883), and Public administration (300).
• Year-to-date employment in June 2020 was down in Agriculture (-750), Resource Extraction (-317), Utilities (-1,200), Manufacturing (-483), Wholesale and Retail Trade (-3,483), Transportation and warehousing (-400), Business, building and other support services (-50), Educational services (-1,717), Health care and social assistance (-233), and Accommodation and food services (-4,033).
• Despite strong housing starts and residential building permit data, year-to-date May 2020 construction employment is down by 2,517 positions from the same period in 2019.
• The average year-to-date unemployment rate advanced from 4.6% in June 2019 to 8.5% in June 2020. Year-to-date, the number of unemployed is up 5,183 in May-June from June 2019. In addition, the number of those of labour force age but not in the labour force increased by 10,900 over the same time period as some workers have withdrawn from actively seeking employment until prospects improve.
• May 2020 total year-to-date housing starts are up by 81 units or 41.5% as the market, feeling the effects of pent up demand, bounces back from a very weak 2019. Year-to-date increases were observed in singles (24 units or 32.0%), semi-detached (4 units or 18.2%), apartment and other types (76 units or 190.0%). Year-to-date declines were limited to row (-23 units or -39.7%).
• Following much of the same growth profile as housing starts, building permits are rebounding from an exceptionally soft 2019 and do not fully reflect pandemic impacts. May 2020 year-to-date building permits are up 25.5% over the same period in 2019. Sub sectors that posted increases were: residential (14.6%) and commercial (81.1%). During the same time period, industrial (-60.4%) and institutional and governmental (-33.6%) saw declines.
• The average year-to-date Housing Price Index Benchmark Price is down from        $266,283 in June 2019 to $264,883 in June 2020.
• The Bank of Canada cut its benchmark interest rate to 0.25%. In 3 rate cuts on March 4, March 13, and March 27. The central bank already cut its rate to 1.25% at a previously scheduled meeting on March 4 to help counteract the impact of the coronavirus. The unscheduled rate decisions on March 13 and 27 shaved a further percentage point from the rate as a proactive measure to boost the economy amid COVID-19 fears.
• 2019 Regina Census Metropolitan Area population was up 1.9% over 2018 to 261,684 on the strength of international and intra-provincial migration. The release of 2020 data is expected in February/March 2021.
• The Conference Board of Canada forecasts Regina real GDP to drop by 4.6% in 2020 after easing by 0.1% in 2019. Real GDP is expected to advance by 5.4% in 2021.