The school year is about to begin, and many young people are likely making some hard financial decisions right now. Youth unemployment hit 14.2 percent in July – the outside the pandemic years of 2020 and 2021.
The youth employment rate has been worsening for a year, dropping by four percentage points since last summer. Among full-time students, the decline was even larger – almost seven percentage points. This represents a loss of 112,000 jobs among students in just a year.
Quebec, New Brunswick, Ontario and B.C. posted the largest drops (down 5.7, 5.2, 4.7 and 3.7 percentage points, respectively).
And the groups experiencing the most significant losses are those which already – including Indigenous young people, racialized youth and recent immigrants.
A very large group of young workers are bearing the brunt of the economic slowdown caused by high interest rates, competing for a limited number of openings not only among themselves but with older, more experienced workers as well.
The Bank of Canada’s aggressive campaign of is working as intended. across a range of industries, not only in sectors like food and accommodation that have yet to fully recover from the pandemic but also in professional services, finance, manufacturing and construction.
The “soft landing” that the business press is celebrating masks the fact that employers are scaling back new hires and offering more part-time work. Given strong population growth, especially among young people, the labour market is simply not growing fast enough to absorb new entrants.
Young people have just come through the huge disruptions associated with the pandemic and are now facing an economic crisis in the context of costs.
The inflation rate may be easing this summer, but the lines at food banks haven’t. Food banks and community pantries across the country, serving students with no money left after covering rent and tuition.
The situation of international students is particularly acute. These students come to Canada on the hook for a massive tuition bill (typically than the equivalent Canadian student) only to find that the is much higher than they expected. As a result, many are living in appalling conditions.
The depth of this generational crisis is staggering. , young adults are facing a future of lower earnings and more employment precarity, further burdened with high levels of debt.
Young people’s experience in the summer of 2024 clearly demonstrates that governments, post-secondary institutions, and employers need to do much more – not only to make education more affordable but to tackle the surge in youth unemployment and the growing divide between good jobs and bad jobs.
In our economic system, there are winners and losers. At this moment, the economic elites are throwing young people under the bus, collateral damage in efforts to rein in inflation and reassert neoliberal economic orthodoxy that delivers extraordinary wealth to the rich.
The systemic underfunding of post-secondary institutions has compounded this difficult situation as schools have turned to international students to fill funding shortfalls – opening the door to precarity and abuse.
Make no mistake. As the baby boom generation retires, Canada will need to rely on the next generation of workers – those who were born here and the many we welcome from abroad. This is precisely the time we need to invest in young people and their futures.
Katherine Scott is a senior researcher with the Canadian Centre for Policy Alternatives.
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