The Labour Force Survey (LFS), conducted by Statistics Canada, collects standard labour market indicators and is a major source of information on the working-age population in all provinces. Tourism HR Canada reviews the estimates available for tourism industries on both monthly and an annual basis.
Labour Force Survey 2023
COVID-19 has had a significant negative impact on Canadian employment. At the peak of the pandemic, Statistics Canada estimated that over five million Canadians had either lost their job or had their working hours reduced by over 50%. COVID-19 hit the tourism sector particularly hard. Before the pandemic, over two million Canadians worked in the tourism sector. However, 880,000 individuals had lost that employment by April 2020. And unlike other sectors, tourism has faced ongoing challenges in getting people back to work.
Because tourism inherently has peaks and troughs at different times of the year, it can be difficult to tell whether variation is due to seasonal fluctuations or the impact of COVID-19. This is why the annual Labour Force Survey data is so valuable: it allows 2023 to be compared with previous years, to reveal trends that are unaffected by this annual seasonality.
Key Insights for 2023
While the total labour force across all sectors recovered in 2021 and has grown in 2022 and 2023, the tourism labour force is still struggling towards recovery. The tourism labour force now accounts for a decreasing share of the overall economy. In 2019, the tourism labour force occupied 10.9% of the total labour force; that number fell sharply in 2020, and while it has been growing since, it had only reached 10.0% in 2023.
Similarly, in 2023, employment across all sectors had recovered, but tourism employment (encompassing all five tourism industries) still lagged behind pre-pandemic levels. This implies that previously unemployed individuals had opted for jobs in other sectors rather than in tourism, making it more difficult for tourism businesses to recruit workers.
- While employment across all sectors in 2023 was 5.9% higher than in 2019, tourism employment in 2023 was 3.8% lower than in 2019.
- The overall Canadian labour force has grown by 5.6% from 2019 to 2023. However, tourism labour force has declined by 4.0% since 2019.
Annual Average Employment by Industry
The lingering effects of COVID-19 continued to cast a shadow over three out of the five tourism industry sectors, namely accommodations, food and beverage services, and travel services, where employment levels had not fully rebounded to 2019 levels, despite being higher than in 2022. Conversely, employment in recreation and entertainment and in transportation has recovered.
The travel services industry was the hardest hit, with employment down 28.2% from 2019. This was followed by the accommodations industry, which saw a decline of 16.4% in its employment from 2019 to 2023. Employment in the food and beverage services industry dropped by 7.0%.
Annual Average Employment by Province
The 2023 Labour Force Survey data reveals that the COVID-19 pandemic impacted provincial labour markets to varying degrees.
Compared to 2022, employment in all provinces was elevated. Nova Scotia saw the biggest employment growth (16.0%), while Saskatchewan saw the smallest growth (1.4%) over the past year.
Despite this growth, no provinces had recovered to their 2019 employment levels yet. Saskatchewan had the most significant employment loss (-12.7%) relative to before the pandemic, followed by Newfoundland and Labrador (-9.2%) and Manitoba (-8.6%). The employment losses in British Columbia and Alberta were the smallest among all provinces (-1.0%).
Annual Average Unemployment by Industry
The unemployment data for the tourism sector paints a rather deceptive picture of the state of the labour market challenges, due to the massive loss of the tourism labour force overall. While this makes the unemployment rates for 2023 similar to 2019 levels, as noted above, the total labour force was dramatically reduced across the tourism industry groups. In 2019, a 5.4% unemployment rate represented 2,223,600 people. In 2023, 5.3% represented 2,135,700 people.
The unemployment rate for the overall economy was 0.3 percentage points lower in 2023 than in 2019, at 5.4%. The tourism unemployment rate was 5.3% in 2023, 0.1 percentage points lower than in 2019. Unemployment rates for the accommodations and food and beverage services industries declined compared to 2019, while the employment rate for the recreation and entertainment industry saw an increase of 0.1 percentage points from 2019 to 2023. The recreation and entertainment industry also had the highest unemployment rate in 2023, while the transportation industry had the lowest, at 2.7%, which was the same as the employment rate in 2019. Note that limited data is available for travel services, so year-on-year comparisons are not possible for this industry group.
Annual Average Unemployment by Province
n 2023, the tourism unemployment rates in Quebec (4.7%), Manitoba (5.2%), and British Columbia (4.9%) were lower than in Canada overall (5.3%).
Comparing the unemployment rate of the tourism sector with that of the total provincial economy, tourism unemployment rates were higher than the overall unemployment rate in six provinces: Prince Edward Island (7.3% vs. 10.9%), Nova Scotia (6.3% vs. 7.7%), New Brunswick (6.6% vs. 9.3%), Quebec (4.5% vs. 4.7%), Manitoba (4.8% vs. 5.2%), and Saskatchewan (4.8% vs. 5.7%).
National Monthly Unemployment Rate (Tourism vs. Total Labour Force)
The national tourism unemployment rate plummeted in February, then continued to decrease in the following months. It was at its lowest in July (4.5%), and then increased overall from July to December.
Merely looking at the unemployment rate, tourism seemed to be doing better than the total economy as the tourism unemployment rate stayed below the overall economy-wide unemployment rate. Again, it should be kept in mind that one significant reason is that the tourism labour force has declined greatly compared to 2019.
Annual Unemployment Rate (Tourism vs. Total Labour Force) 2006 – 2023
Between 2005 and 2008, the tourism unemployment rate closely mirrored that of the total economy. But starting from 2008, those rates diverged. The financial crisis drove up the unemployment rate in all sectors, but the tourism sector was less affected compared to the overall economy. For a decade after the financial crisis, tourism unemployment was consistently about a percentage point lower than the overall unemployment rate. That trend came to a crashing halt in 2020. Overall, the unemployment rate spiked to 9.7% (higher than at the height of the financial crisis), whereas tourism unemployment soared to 17.2%. In most provinces, the tourism unemployment rates were unprecedented.
As of 2023, the unemployment rates for both the overall economy and the tourism sector remained relatively stable compared to 2022, and these rates were generally lower than historical levels.
Source: The information presented here is drawn from Statistics Canada’s Labour Force Survey. It shows rates of unemployment in Canada’s tourism sector by province and by industry group. The data is seasonally unadjusted to allow comparisons between the tourism sector and the overall economy. As such, monthly and annual numbers for Canada’s entire labour force will differ from the seasonally adjusted numbers that are commonly reported.
Statistics Canada has introduced revisions to the historical Labour Force Survey (LFS) data that Tourism HR Canada uses for our labour market information reporting. Consequently, there may be slight variations between what is reported on the Statistics Canada site and our site, but the narrative of significant job losses remains unchanged.
Tourism HR Insider subscribers receive monthly estimates of employment and unemployment for each of tourism’s five industry groups and for each province. To sign up, click here.
You can also access detailed Labour Force Survey data by occupation and region through our Rapid reSearch tool, hosted on emerit.ca. Sign up for an account to gain access to the data.
This project is funded by the Government of Canada’s Sectoral Initiatives Program
The opinions and interpretations in this publication are those of the author and do not necessarily reflect those of the Government of Canada.