Amid the raging second wave of the Covid-19 pandemic, the unemployment rate in Canada rose by 0.6 percentage point to 9.4 per cent in January, the highest rate since August 2020, according to the national statistical office.

On Friday, Statistics Canada said that employment decreased by 213,000, or 1.2 per cent, in January as lockdowns and restrictions caused the closure of many businesses across the country, reports Xinhua news agency.

The decrease marked a second straight month that the labour market contracted after 63,000 positions disappeared in December 2020 to break a streak of monthly gains that began in May 2020.

It was heavy in the services sector and part-time work fuelling the largest monthly decline since last April when some 2 million jobs were lost.

Compared with February 2020, employment was down 858,000, or 4.5 per cent, in January and Covid-related absences from work were up 529,000.

Among Canadians who worked at least half their usual hours, the number working from home increased by nearly 700,000 to 5.4 million in January, surpassing the previous high of 5.1 million last April.

January's employment figures show the "continuing challenge of balancing economic activity with the need to protect public health", and how restrictions hit specific sectors and groups of workers harder than others, the national statistical office added.