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Youth Unemployment in Canada: Challenging Conventional Thinking? 

Report Highlights


Definition of age groups:
    Youth – individuals 15 to 24 years of age
    Young workers – individuals 25 to 29 years of age
    Mature workers – individuals 30 to 54 years of age
    Older workers – individuals 55 years of age and over

The youth unemployment rate in Canada reveals a positive trend despite the most recent recession.

  • The highest level of youth unemployment (15.2 per cent) during the recent recession was noticeably below that experienced during previous recessions when youth unemployment swelled to 19.2 per cent in 1983 and 17.2 per cent in 1992.
  • In 2011, the Canadian youth unemployment rate was 11th lowest among 34 OECD countries while unemployment rate of young and mature workers ranked 19th lowest.

The majority of youth are unemployed as they transition from school to the labour market. Nearly half of jobless youth find work within 1 to 4 weeks.

  • Nearly half (46.8 per cent) of unemployed youth were able to find a job within 1 to 4 weeks in 2011 while the average duration of unemployment experienced by youth did not exceed 11 weeks in that year. In fact, the average duration of youth unemployment in 2011 was well below the shortest average duration ever experienced by young and mature workers over the past 30 years: 12.5 weeks in 2006 and 16.2 weeks in 2008 respectively.
  • In 2011, only a small proportion of unemployed youth (5.4 per cent) experienced long-term unemployment, i.e. were unemployed for more than one year. Young workers were twice more likely and mature workers were three times more likely to be unemployed long-term.
  • More than half (57.4 per cent) of all unemployed youth in 2011 had come out of school; only a small proportion (14.8 per cent) became jobless due to involuntary layoffs.

Baby boomers are not crowding out youth from career opportunities.

  • The noticeable overlap in occupational preferences of youth and older workers is present in only two occupational groups – clerical occupations and sales and service occupations. The youth unemployment rate in these occupations is relatively low.

Many youth are underemployed and do not use their skills to the fullest potential. Underemployment has dire consequences for Canadian workers and the economy, but its causes are not well understood.

  • Underemployment of youth in Canada exists through both the underutilization of skills and labour; however, all age groups are susceptible to underemployment.
  • Some 24.6 per cent of all youth holding a university degree who were continuously employed full-time during 2005 were effectively underutilized as they were employed in occupations where employment requirements did not call for post-secondary education.
  • The underutilization of skills among youth is prevalent in sales and service occupations and clerical occupations, it is also present in such occupational groups as: technical occupations related to natural and applied sciences, technical occupations in computer and information systems, and assisting occupations in support of health services.
  • Youth experience a high rate of involuntary part-time employment. In 2011, the economy was underutilizing the ability and willingness to work of some 4.0 per cent of employed youth.

Recommendations

  • The issue of youth unemployment and underemployment may be rooted in an inadequate match between employers’ needs and workers’ skills. Greater use of school-employer partnerships may help to improve the match between employers’ needs and workers’ skills as well as to help youth make informed decisions about their field of study.
  • A constructive, needs and ability based approach of career advisors, educators and parents in guiding youth in their career choices is instrumental in ensuring that the level of skills present in the economy is adequate.
  • A better mix of employment opportunities with greater reliance on higher-skilled, higher-wage jobs cannot be achieved without improved competitiveness of Canadian businesses. Available pathways to improved competitiveness include investment in machinery and equipment, particularly in information and communications technology, investing in research and development (R&D) and innovation, and aggressively competing in foreign markets.
  • Improving the understanding of causes of youth underemployment may be achieved by launching a research initiative focused on the issue and involving businesses, educators, community organizations as well as not-for-profit groups engaged in public policy analysis.
  • Examining evidence that may shed light on causes of different types of underemployment is important for developing adequate measures and strategies to tackle the issue of underemployment.

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CGA-Canada | Last Updated: December 14, 2012

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