This isn’t your older brother’s recession: 2020 vs. 2008.
TL;DR version: It was mostly men that lost their jobs after the financial crisis, due to the impact the recession had on construction and manufacturing. That’s not likely going to be the case this recession and our stimulus policies need to reflect that.
The April edition of the Labour Force Survey is released on May 8th, 2020. If it’s anything like the last edition, it will show that the disemployment from the current crisis is largely affecting women. That wasn’t the case in 2008.
The disemployment from the financial crisis started in late 2008. Here’s the net employment impacts in April 2009, exactly six months after.
Employment in April 2009, Relative to October 2008, by Sex and Industry
Six months after the recession started, net employment in Canada had fallen by 681,000 jobs, with net employment for men falling by 480,000, representing 79% of the total decline. Nearly 57% of the total net drop in employment came from two industries: construction and manufacturing.
Let’s fast-forward to October 2009 and examine net employment levels one year later.
Employment in October 2009, Relative to October 2008, by Sex and Industry
Employment levels had recovered somewhat, with net employment now down only 387,500 from October 2008 levels (though this understates the problem, as the total number of jobs would have risen without the recession, due to a growing population). Once again, we see that male disemployment is responsible for just over 79% of this decrease, and over half the disemployment comes from two male-dominated sectors: manufacturing and construction.
For comparison, here’s October 2008-April 2009 to the current recession. Unfortunately, we have exactly one month’s worth of data; I’ll update this chart on May 8th after the release of the next Labour Force Survey. We also know that these numbers and proportions will change once the lockdown is over, though we should expect many retail and hospitality jobs not to come back.
So far what we’re seeing is a service-sector recession affecting women, rather than the goods-sector recession affecting men of the previous recession.
One other way we can visualize the differences is to compare the 700,000 jobs lost in the first three months of the 2008–09 recession with the million jobs lost in the first month of this crisis. As you’ll see, they couldn’t be any more different.
It will be worth watching how employment in the goods and services sectors track the 2008–09 recession. After one month of each, the goods sector had a smaller decline this recession than it did in 2008–09 (69,000 jobs lost vs. 101,000 in 2020), while the service sector jobs loss was over 12 times higher this recession vs. the past one (78,000 jobs in 2008–09 vs. 991,000 jobs in 2020).
Once the dust clears, it’s unlikely that we’ll have a repeat of the construction and manufacturing-based recession of 2008–09. We need to make sure we’re solving the problems of this recession, not fighting the last war.