Decreasing opportunities and rising costs leave youth adrift – MoneySense

Hood, who had been living with her parents in Aurora, Ont., since graduating from college, recalled applying for a job that she felt perfectly matched her qualifications. The company had to close the application portal early because more than 450 resumes had been submitted, she said. Even jobs for which she thinks she is more than qualified, such as a restaurant server or a retail job, are difficult to obtain.

Young people are struggling as unemployment reaches a 15-year high

It’s been difficult to deal with rejections and applying seems pointless, Hood said. “I feel behind, even though I just graduated,” she says. “I don’t really have stability in my life or even a schedule,” she said. “For me, I’m just going day by day, and it’s really stressful.”

Many young people who spoke to The Canadian Press recognize that disillusionment — a waning belief that hard work will result in the quality of life their parents and grandparents were able to secure. Today’s young workers say they are struggling to get ahead in a job market devoid of opportunity and in an economy where rising prices lock them out of the way society used to mark adulthood.

Youth unemployment reached 14.7% in September, a 15-year high outside of the COVID-19 pandemic years, according to Statistics Canada. Employment for young workers began to rise in October and November, but employment remained marginally above the summer low.

The chances of young people finding a full-time job have steadily declined

Career prospects for young workers have been declining for years. StatCan said that in 1989, almost 80% of workers between the ages of 15 and 30 had full-time, permanent jobs. Thirty years later, in 2019, this had fallen to around 70%. And five years later, less than 60% had a full-time, permanent job.

The Canadian economy is currently under pressure from US tariffs and trade uncertainty, limiting demand for workers. Many economists say young people and other vulnerable Canadians are typically among the first to feel the pinch as job openings dry up. “That’s a lot of what we saw this summer… the companies that would have been big employers were just not there,” said economist Kari Norman, one of the authors of a Desjardins report on youth unemployment published in September.

The labor market is crowded under pressure from AI and immigration

Desjardins found the sharp rise in youth unemployment is more typical of a Canadian recession, rather than the more modest kind of downturn the country appears to be experiencing. One explanation for the imbalance is population growth. The federal government has opened the immigration taps to let in more foreign workers and international students to meet companies’ fierce demand for workers after the pandemic, Norman said.

Ottawa has since tempered the flow of newcomers, which Norman said would help rebalance long-term employment prospects. But for now, young people are stuck competing for early career experience in a crowded job market.

Artificial intelligence is also increasingly being used to perform the kinds of entry-level tasks that young workers used to get their first jobs with. Norman said that creates a gap between entry-level positions and positions that require a few years on the job. “How do you get those first five years of experience?” she asked.

Osobe Waberi found the answer to that question beyond Canadian borders. When the rent on her shared apartment in downtown Toronto rose $500 a month, Waberi was dejected. Waberi, who had lived in Toronto for a decade and watched the affordability crisis unfold, said her full-time job couldn’t keep up with rent increases and the high cost of living in a metropolitan city. “It just didn’t feel like I could grow more in the city I love,” she said.

She moved to Oman earlier this year with a two-year residence permit. The Middle Eastern country offered what she was looking for: a better opportunity to quickly boost her savings while offering the chance to start a PR firm focused on Canadian clients. Waberi said she eventually wants to return to Toronto and make the city her home again. “I love Toronto, it’s home, and I’m definitely homesick. But I was more tired of paying the rent,” she said.

Home ownership remains out of reach for many young Canadians

Data from Generation Squeeze, a non-profit organization focused on creating a level playing field for Canada’s youth, shows that it is much harder for them to get their foot on the real estate ownership ladder than it was for their parents.

According to the organization’s calculations, it took the average 25-34 year old in 1986 five years to save for a 20% down payment on a representative home in Canada. In 2021, that figure was 17 years nationally and even higher at 27 years in the greater Vancouver and Toronto areas.

Generation Squeeze CEO Paul Kershaw said the time it takes to save for a home has reversed course in recent years, reaching nearly 14 years by 2024, amid a stalled housing market and lower interest rates. But home prices would still have to fall sharply from this point if younger Canadians want the same opportunity for homeownership as previous generations, he said.

Lisa Taylor, founder of the Challenge Factory, a consultancy focused on the future of work, said young people were facing “economic scarring” after the pandemic. Restrictions on in-person work left many missing the crucial in-person experiences needed to build professional networks earlier in their careers, she said. But Taylor also said the economic challenges facing Canada’s youth may reflect not lost hope, but shifting timelines.

Many stay in school longer and therefore enter the labor market later, marry later and buy a house if they have access to the traditional two-income household. “Is Gen Z screwed? Or is it just taking longer to reach the various milestones that we feel like should happen sooner.”