Young Workers Archives - Centre for Future Work

Youth Unemployment: The Canary in the Coal Mine

Jim Stanford — Mon, 02 Feb 2026 06:38:19 +0000

A version of this commentary was originally published at rabble.ca.

Unemployment has remained stubbornly high in Canada, made worse by the consequences of Donald Trump’s tariffs and the lingering effects of high interest rates. As always, young people bear the heaviest burden of a weakening labour market. They are the last hired, and first fired – and hence rising unemployment is a danger sign of labour market turbulence ahead. Last summer had the highest unemployment among returning students since the turn of the century (save the COVID pandemic), and the coming summer job season shows no signs of substantial improvement.

As of end-2025, there were some 420,000 unemployed workers in Canada under age 25, and they faced an average unemployment rate of 13.3%. The 25-29 age cohort can also be defined as ‘youth’; there were almost 200,000 of them unemployed at year’s end. That makes a total of over 600,000 unemployed people under 30, for a combined unemployment rate of about 10%. Unemployment is worst for the youngest workers: 18% for those under 20.

That youngest age cohort (15-19) has also seen the biggest increase in the unemployment rate in the last two years. In addition, the participation rate for all youth cohorts has also dropped somewhat (again, especially for the youngest workers). Without that drop in labour force participation, the official youth unemployment rate would be even higher. Unemployment is worse for young men than for young women.

Conventionally measured youth unemployment (15-24) is typically around twice as high as average unemployment, and the relationship between the two did not substantially change in recent years: youth unemployment has been very high, but rose in step (2 points up for every 1 point rise in the national average rate) with the broader weakening of the labour market.

For that reason, a central focus of the solution to youth unemployment must be a commitment to reduce allunemployment – rather than imagining ways to essentially ‘redistribute’ unemployment, by helping more young people to get hired in the context of a labour market that remains underutilized. Strategies to strengthen overall job-creation include: stronger private and public investment, stronger support for public and caring services, industrial policy to strengthen Canada’s value-added industries, and shifting the emphasis of monetary policy to prioritize job-creation along with inflation-control.

This commitment to full employment at the macroeconomic level can be usefully supplemented by particular targeted supports for young workers. Examples of these measures could include expanded summer and post-graduation job programs, stronger on-the-job and apprenticeship training programs (with direct links to post-graduate job opportunities), and experiential working and learning opportunities (such as Canada’s Katimavik program, or the proposed Youth Climate Corps) that give young people both new skills and general life experience.

There are some strategies for sharing the burden of unemployment that could indeed help young workers who might otherwise be laid off, but in ways that are fair for older workers, too. Work-sharing programs in workplaces hit by downsizing help to preserve overall headcounts (and avoid the main burden of layoffs falling on young workers with less seniority). Early retirement incentives can encourage older workers to voluntarily leave work during a downturn (again preserving employment for young workers with less seniority).

Additional measures can improve pay and income security in jobs disproportionately filled by young people. This would include a commitment to higher minimum wages (since a large share of minimum wage workers are youth), and better regulation of non-standard employment arrangements (such as gig and platform work, where young workers are also disproportionately concentrated).

The general economic well-being of young people can be further improved with other measures such as lower costs for essential services that are used intensively by youth (like tuition fees and public transit), and a comprehensive strategy for addressing Canada’s housing crisis (young people have been hardest hit by the unaffordability of home ownership and especially rents).

A far-reaching proposal in this vein could include a basic income for young people (perhaps 18-25), that would provide baseline income supports to avoid poverty and facilitate young people to undertake education, start businesses, and successfully launch their working lives. Together with the existing Canada Child Benefit, the Guaranteed Income Supplement for low-income seniors, and the new Canada Disability Benefit, this would represent an important incremental step in creating a basic income floor for all Canadians.

Research has shown a ‘scarring’ effect for young workers who start their careers during a downturn, reducing their lifetime earnings trajectories by as much as 10% over their careers. That represents a lifetime loss (in real 2026 dollar terms of almost one-quarter million dollars! This income reduction results from both lost income during the initial years of unemployment, but more importantly from the reduced trajectory of earnings gains over a young worker’s subsequent years of work.

Centre for Future Work Economist and Director Jim Stanford recently spoke on the youth unemployment crisis, and how to support young workers, to the ‘Elbows Up T.O.’ assembly, organized by former Toronto Mayor John Sewell. A video of the full event is available through the ‘Elbows Up T.O.’ website.

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Is There Really a Shortage of Labour?

Jim Stanford — Wed, 28 Jul 2021 22:07:25 +0000

With restaurants and stores opening up again after the pandemic, loud complaints are emerging from employers in the hospitality and retail sectors that they can’t find enough workers. Many point the finger at government income supports which supported people through the pandemic (including the former CERB, cancelled last September, and subsequent improvements in EI benefits). Many also want the federal government to open the taps on Temporary Foreign Workers, to bring in more low-cost labour from other countries.

However, the hard economic evidence does not support this complaint about a supposed ‘labour shortage.’ Yes, it is certainly an operational challenge for restaurants and stores to reconnect with former employees after many months of closure – and they’re all trying to recruit former and new staff at the same time. But unemployment remains elevated: the official unemployment rate is 7.8%, and the true rate (including underemployment, people who have left the labour force, and other ‘hidden’ pools) is closer to 15%. Wages in retail and hospitality remain very low, and they are not rising – which we would expect if labour was genuinely ‘scarce.’ An even bigger barrier in these sectors are hours of work: most staff are part-time, and their shifts are very unreliable.

If employers in these sectors want to recruit and retain a more stable workforce, they should start by improving wages and conditions: better pay, stable shifts, better benefits, improved training and safety. If government responds to these employer complaints by cutting income supports or liberalizing temporary migrant labour, that will only forestall the improvements in the quality of jobs that workers in these sectors desperately need.

The Centre’s Director Jim Stanford has made several interventions in recent weeks highlighting the problems with the ‘labour shortage’ hypothesis – and urging employers to improve wages and working conditions as their industries emerge from the pandemic.

For example, Jim was recently interviewed by Amanda Lang, host of the BNN Bloomberg Markets program. Their wide-ranging chat about the future of work after the pandemic addressed the claims of labour shortage, and also whether unions would be more assertive as the economy re-opens in pressing demands for better wages and job security.

Jim also spoke with Michelle Eliot on CBC Radio’s province-wide call-in show, BC Today, along with Ian Tostenson (head of the provincial Restaurant Association). Audio from the segment can be heard here (starting at the 34:00 mark). Like other business leaders, Ian suggested that COVID emergency income supports (like the CRB) and restrictions on Temporary Foreign Workers were worsening this alleged labour shortage. But several phone-in callers highlighted the problem of low wages in the industry, and noted the impossibility of trying to cover housing costs in BC on the basis of typical restaurant wages. One business owner also highlighted how important government income supports were to her own business’s survival – highlighting the hypocrisy of business owners attacking COVID support payments for workers, while benefiting so much from payments to business.

Jim also had a feature interview with Jody Vance for CKNW News Radio on what measures can be taken to improve the quality of work in hospitality and retail services, so that workers hvaea better wages and conditions – and providers can have a more stable workforce.

The Toronto Star has also quoted Jim in recent reports on the supposed labour shortage: including this article on hiring in retail and hospitality, and this report on whether the hiring will lead to sustained improvements in wages and benefits.

Jim also appeared on Shaye Ganam’s province-wide talk show in Alberta (on CHED and CHQR radio stations) to discuss the staffing challenges as Alberta’s hospitality sector re-opens (starts at 24:00 minute mark).

Stand by for more research and commentary on the labour shortage debate, which is sure to heat up as Canada’s economy continues to reopen!

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The ‘Class of COVID’ Needs Support After the Pandemic

Jim Stanford — Fri, 28 May 2021 20:07:53 +0000

Young people have been among the hardest-hit by the economic fall-out from the COVID-19 pandemic and resulting recession. More than one in four workers under age 30 lost their jobs when the pandemic hit. And young workers now account for two-thirds of remaining job losses. Earnings for workers entering the job market at this time will be suppressed for many years to come, perhaps for their entire working careers.

In this commentary, originally published in the Toronto Star, Centre for Future Work Director Jim Stanford describes the disproportionate losses experienced by young workers – and urges powerful measures to support their recovery after the pandemic.

By Jim Stanford

We have known from the beginning that older people are most at risk from serious illness or death from COVID-19. But young people will clearly bear the worst economic and social consequences of the pandemic and its aftermath.

Physical distancing and isolation are hardest for youth, whose developing personalities depend on social interaction and validation. Young Canadians are experiencing an epidemic of suicide, substance abuse, and eating disorders that rivals the coronavirus in ferocity; health officials have declared a youth mental health emergency. Disrupted schooling has held back educational progress at all levels, with lasting ramifications for students’ learning and future employment.

The economic consequences of the pandemic are also brutally concentrated among youth. Every recession is terrible for young workers: they are the last hired, and the first fired. But this downturn has been worse for young workers than any other in postwar history.

26% of workers under 30 lost their jobs in the first two months of the pandemic – compared to 12% for over-30s. Pigeon-holed into part-time and temporary positions, young workers were easy to dismiss when the lockdowns hit.

But the subsequent rebound in employment has been much weaker for young workers. Over two-thirds of all remaining job losses (relative to pre-pandemic levels) are among workers under 30, even though they account for barely one-fifth of the working age population.

Youth who kept their jobs most likely worked in customer-facing roles (in retail, hospitality, and other consumer sectors) where the risk of COVID-19 infection is severe – but where basic protections (like paid sick leave) are rarely provided.

Last summer the federal government offered a spate of emergency supports to youth, including the Canada Emergency Student Benefit (CESB). It paid up to $1250 per month to incoming or returning students without summer work.

This summer the pandemic still rages – but there are no targeted benefits for young workers. The CESB was cancelled. And the previous Canada Emergency Response Benefit has been replaced by expanded Employment Insurance, which most young unemployed can’t qualify for. Many youth now face a dismal summer labour market, with no income support at all.

Sadly, the economic pain for young workers will last a long time. Labour economists have documented a problem called labour market ‘scarring’: young people who experience unemployment early in their work lives, are likely to experience cumulating losses through the rest of their careers. Their earnings trajectory never catches up to what it would have been.

The math is daunting: just deferring the start of work (and subsequent wage progression) by one year can cost a new labour market entrant $100,000 or more over their career. Without targeted supports to help young workers regroup, they’ll be suffering from this pandemic long after the rest of us are gone.

Governments are presently focused on rolling out vaccines (still not available to many young workers) and planning eventual re-opening. But an ambitious strategy to help young people rebuild their lives when this is all over is a vital prerequisite for long-term economic and social recovery. Governments need to think big, and move fast, to support young workers.

For starters, the federal government should restore the CESB program for this summer. Yes, it is already May, and some students have found work. But the benefit could still be paid retroactively, and would make a vital difference for many struggling students and their families.

Then we need other powerful measures to help young people build their careers amidst the post-COVID economic rubble. A ’youth guarantee’ program, similar to those pioneered in the Nordic countries, would provide every school graduate with a job, financial support to start a business, or funding to continue higher education. That could be supplemented by a youth community and environmental corps (perhaps building on Canada’s Katimavik program) to give youth paid experience in environmental remediation, green skills, and other community-building projects. More conventional measures to support recovery in the youth labour market should include stronger apprentice systems and much better youth job placement services.

Young people have made huge sacrifices to protect their elders from COVID. The least we can do is acknowledge the vast economic consequences they will also face, and do what we can to compensate them.

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