Sarah Chung stands at her convocation, degree in hand, but the celebration feels muted by uncertainty. Canada’s newest graduates are entering a workforce that’s less welcoming than at any time since the 1990s, and the numbers don’t lie—the country faces its highest youth unemployment rate in a quarter-century, pandemic years aside.
The Canadian labour market, once buoyed by rapid post-pandemic hiring, has lost its momentum. As inflation outpaced wage growth and population gains outstripped available jobs, the promise of abundant opportunity quickly faded. Young adults now confront a tangled web of economic stressors, from rising interest rates to the ever-present threat of recession, all while the U.S. trade war continues to cast a long shadow over economic stability.
Statistics Canada’s first quarter data paints a sobering picture: people aged 15 to 24 are experiencing joblessness levels not seen since the mid-90s. There’s also a surge in the NEET rate—youth neither working nor in school—a metric that flags those struggling to get a foothold. Meanwhile, an influx of temporary foreign workers, especially in food and retail, has made competition fiercer, complicating young Canadians’ efforts to launch their careers.
What makes this crisis unique is its multifaceted origin. Economic recovery whiplash, aggressive immigration policies, and a burst of automation have left entry-level positions scarce. Older workers, pressed by affordability issues, are holding onto jobs or taking on second ones, narrowing the window for Gen Z further. According to Tricia Williams of the Future Skills Centre, youth unemployment is a “canary in the coal mine,” warning of broader turbulence ahead.
But the consequences aren’t limited to today’s paycheque. Economist Miles Corak warns that “scarring”—the diminished long-term prospects stemming from early-career unemployment—is a genuine risk. When opportunities stagnate, graduates may slide into roles below their skill level, dragging down lifetime earnings and ambition.
These headwinds should set off alarm bells for policymakers and businesses alike. If Canada’s future workforce is left idle now, the aftershocks could echo across decades in lost potential and innovation. Real solutions demand urgency and imagination—because the country’s economic health depends on more than just numbers; it rests on the aspirations of its youngest workers.
References:
Gen Z is facing the worst youth unemployment rate in decades. Here is how it’s different
