Question Period Note: YOUTH UNEMPLOYMENT IN CANADA

Youth unemployment in Canada is increasing: Young people in Canada are finding it more difficult to find jobs (summer and post-graduate) amid rising competition and a softening labour market.

· Young Canadians have had a challenging summer job search.

· Many continue to struggle in finding either part-time work or their first full-time job after graduation.

· Full-time students seeking employment face unique challenges.

· The Government recognizes the value that youth and students bring to the labour market and has made significant investments to support them in reaching their employment goals.

· In 2024-2025, the Government will create over 130,000 opportunities through the Youth Employment and Skills Strategy Program, Canada Summer Jobs and the Student Work Placement Program.

· Budget 2024 committed $558.8 million in additional funding for these programs in 2025-2026. Next year, this will create 130,000 opportunities for youth and students to gain skills and launch their careers.

1. Unemployment rate for youth (age 15-24) was 13.5% in June, up to 14.5% in August 2024, the highest since the pandemic. In comparison, unemployment rate for core-aged workers (age 25-54) was 5.3% in June and 5.4% in August 2024.
   • High school aged youth (age 15-19) saw the highest year-over-year increase from 15% in August 2023 to 19.6% in August 2024.
   • For youth who are full time students planning to return in fall, the unemployment rate increased by 4.3 percentage points from a three-month average of 12.2% in August 2023 to 16.5% in August 2024.
   • Youth unemployment rate is highest among non-returning students (who attended school full-time in March but are either not planning to return full-time in the fall or are uncertain about their plans) increasing by 4.8 percentage points from 15.3% in August 2023 to 20.1% in August 2024.
   • Youth employment increased in part-time jobs by 2.6% from August 2023 to August 2024, while decreased in full-time jobs by 1.1%. For Canadian-born youth, the decrease in full-time employment was 3%.
   • In August, unemployment rates for racialized youth (18.8%) and Indigenous youth (16.5%) were significantly higher than the rate for non-racialized youth (11.8%).

2. The youth labour force grew at a 3.8% (+115,000) rate, exceeding the overall rate of population growth. Among youth, this increase was concentrated in the post-secondary age group (20-24) (+7.2% growth year over year).
   • Labour force growth can be attributed to an influx of newcomers and a larger cohort of Canadian born and landed immigrants aged 15-24.
   • 60% of the annual growth in August in youth labour force is attributed to youth who are neither born in Canada nor landed immigrants.

3. The summer job market this year was more difficult for youth than in the recent past.
   • Returning students had an employment rate of 46.8% in June 2024, compared to the recent high of 53.7% observed in June 2022.
   • It was also the lowest rate since June 1998 (44.1%), outside of pandemic years.

4. There is a noticeable decline in job vacancies, particularly in industries that typically employ youth on a part-time or temporary basis.
   • Job vacancies and vacancy rates have declined continuously since Q3 2023, suggesting a general softening of the labour demand.
   • Further, almost half of youth (~45% historically) are typically employed in retail trade and accommodation and food services. Over the last year, youth employment declined significantly in retail trade (8.3%) and accommodation and food services (8.0%) (August 2024 figures).

5. Unemployment rates among young post-graduates (age 25-29) are typically lower compared to young workers with lower educational attainments, but all groups experienced increases in 2023.
   • Unemployment rate increased from 4.4% in 2022 to 5% in 2023 for young college or trade graduates, and from 4.9% in 2022 to 5.4% in 2023 for young university graduates, a level close to the pre-pandemic rate of 5.2% in 2019.
   • Young high school graduates aged 25 to 29 experienced the largest increase in unemployment rate, rising from 7.9% in 2022 to 9.8% in 2023, which is 1.1 percentage points higher compared to 2019 (8.7%).

6. Entry-level job vacancies experienced the sharpest decline among all job categories in the second quarter of 2024 compared to the same period a year earlier.
   • In the second quarter of 2024, job vacancies requiring less than 1 year of experience fell to 282,745, a significant 33.8% decrease from 427,060 in the second quarter of 2023.

SWPP – Student Work Placement Program
• Budget 2024 proposed $207.6 million in 2025-2026 for the Student Work Placement Program (SWPP) to create more work-integrated learning opportunities for post-secondary students.

• Budget 2023 invested $197.7 million in 2024-2025 to SWPP to continue creating quality work-integrated learning opportunities for students through partnerships between employers and post-secondary education institutions.

• The Program will support the creation of 40,000 work-integrated learning opportunities per year until 2025-2026 across various sectors nationwide.

YESS- Youth Employment and Skills Strategy
• Budget 2024 proposed $351.2 million in funding to help create 90,000 youth job placements and employment support through the overall YESS. These investments include:
o $200.5 million in 2025-2026, for Canada Summer Jobs to provide well paying summer job opportunities, including in sectors facing critical labour shortages, such as housing construction; and,
o $150.7 million in 2025-2026, for the Youth Employment and Skills Strategy Program to provide job placements and employment supports to youth.

• The 2022 Fall Economic Statement allocated $802.1 million over 3 years starting in 2022-2023 for the YESS, including:
o $301.4 million over two years, starting in 2023-2024, through the Youth Employment and Skills Strategy Program;
o $400.5 million over two years, starting in 2023-2024, to Canada Summer Jobs to support a total of approximately 70,000 annual summer job placements; and,
o $100.2 million over three years, starting in 2022-2023, to continue supporting work placements for First Nations youth through the Income Assistance-First Nations Youth Employment Strategy Pilot.

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