Gen Z is facing the worst youth unemployment rate in decades. Here is how it's different

Graduation headdress successful hand, Sarah Chung is posing for photos in schoolhouse regalia ahead of her convocation ceremony. The field ambiance is joyful, but what comes adjacent is sobering: this honours pupil is graduating into 1 of the worst younker labour markets seen successful decades.

"It's bleak," said the 23-year-old graduate of the University of Calgary's media and communications program. She hasn't been capable to find a occupation successful her field and said she intends to pursue a master's degree.

"I judge that it's pugnacious conscionable due to the fact that of everything that's happening with the economy, with our society and with politics," she said. "There's a whole [lot] of speech astir 'there's a recession coming.' I'm not an economist, but I tin besides spot it arsenic well."

Chung is portion of a procreation facing Canada's highest younker unemployment complaint successful astir a quarter-century. 

Apart from the pandemic, Canadians between the ages of 15 and 24 are facing the highest younker unemployment complaint this state has seen since the mid-1990s, according to archetypal 4th information from Statistics Canada.

At that time, Jean Chrétien was Canada's premier minister, Gen Z was but a twinkle successful their parents' eyes, and the planetary workforce had yet to beryllium transformed by societal media, gig enactment and artificial intelligence.

Fast guardant to 2025, and Canada's youngest workers are grappling with a perfect storm of economic conditions: an ostentation situation that came connected the heels of a pandemic; a surge successful colonisation maturation that has outpaced the fig of disposable jobs; and now, a state teetering person to recession arsenic the U.S. commercialized war wreaks uncertainty connected the economy.

One adept says younker unemployment tin beryllium a "canary successful the ember mine" that foreshadows broader troubles successful the labour market.

"It's benignant of an aboriginal informing indicator," said Tricia Williams, manager of probe astatine Future Skills Centre, a Toronto Metropolitan University laboratory dedicated to studying the aboriginal of work. 

"It's not conscionable astir getting jobs and skills experience. It's astir the larger structural supports and the situation that young radical are coming into."

Labour marketplace whiplash

The Canadian labour marketplace has endured a benignant of whiplash successful recent years.

After pandemic-era restrictions were lifted, companies celebrated with a hiring spree — the system regained jobs it mislaid during the crisis and Canadian younker reaped the rewards of a summertime occupation boom.

But employers were soon struggling to find workers and capable postings, a effect of the workforce having shrunk during the pandemic. The national authorities and nationalist argumentation experts prescribed higher migration arsenic an antidote to the shortage, which led to a emergence successful the Gen Z and millennial moving population.

Hiring sentiment "was truly precocious coming retired of the pandemic, which astir apt was ne'er going to last," said Brendon Bernard, a elder economist astatine Indeed who intimately follows younker labour marketplace trends.

As the hiring backlog cleared, different conditions started to dilatory the system down, helium added.

The onset of a fierce inflation occurrence successful mid-2021 triggered a domino effect: consumers pulled backmost connected spending and the Bank of Canada began an assertive involvement complaint hike cycle, starring businesses to delay hiring arsenic economical assurance deteriorated. 

Older workers started moving 2nd jobs to wage the bills during the affordability crisis. Some experts fishy that the automation of regular tasks could beryllium starring to less entry-level opportunities, but determination isn't capable information to accidental however wide this is.

"As things person turned backmost and leader appetite has fallen backmost down to earth, the younker employment concern has weakened," said Bernard.

'It is disheartening'

Youth unemployment started ticking backmost up successful the outpouring of 2024. At the aforesaid time, the fig of young radical not successful education, employment oregon training — an economical measurement called the NEET rate — has risen among younker successful their aboriginal 20s, mainly driven by non-students having occupation uncovering work.

Bernard said determination was immoderate cautious optimism astatine the opening of this year, erstwhile the labour marketplace seemed to beryllium stabilizing. But the Canadian system has been rocked by U.S. commercialized warfare uncertainty since April, potentially stifling the hiring appetite arsenic the overall unemployment complaint rises.

"It is disheartening," said Thivian Varnacumaaran, an electrical engineering pupil successful his last twelvemonth astatine York University who estimates that he's applied for 400 to 500 jobs — with no luck — since helium started searching successful December.

"I wouldn't accidental I'm pessimistic, but I'm truly realistic astir the situation," the 25-year-old added.

Charles St-Arnaud, main economist astatine commercialized relation Alberta Central, says the system is present "sluggish" adjacent without having breached recession territory. He expects much signs of deterioration successful the coming months, and noted that young radical volition apt carnivore the brunt of those conditions.

"Often businesses bash what I would telephone the 'last in, archetypal out' benignant of strategy erstwhile they trim headcount," said St-Arnaud. "The younger colonisation that has been conscionable hired are much astatine hazard of being laid disconnected successful a downturn."

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The scars of unemployment

The bleak hiring scenery has immoderate young radical taking jobs conscionable to enactment up of the bills.

"I spent 2 hours sweeping yesterday, and I person a mechanical engineering degree," said 24-year-old Ben Gooch of Dundas, Ont.

The McMaster postgraduate is moving part-time astatine a plot centre to screen immoderate of his surviving expenses, having applied for upward of 100 jobs since December with lone a fistful of interviews to amusement for it. "I consciousness similar I'm conscionable throwing darts retired astatine a partition and hoping to get fortunate and deed something." 

Data shows that it's fairly communal for young graduates to enactment successful a occupation that lone requires a precocious schoolhouse diploma.

But Canadian probe has shown that being unemployed astatine a young property during a recession tin pb to a persistent but non-permanent net nonaccomplishment for galore years aft — a well-studied improvement known arsenic "wage scarring." Other probe besides suggests that entering the labour marketplace during a recession tin interaction a person's health outcomes. 

"Where it tin pb to scarring — I mean, we mightiness deliberation of it arsenic benignant of a impermanent blemish — but it tin person agelong word implications erstwhile the system goes into a superior recession," said Miles Corak, an Ottawa-based economics prof astatine the City University of New York's Graduate Centre.

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"Long-term earnings prospects are dampened for radical graduating during the recession — not due to the fact that they're not getting jobs, but yet they autumn into a portion of the labour marketplace that isn't arsenic high-paying, successful types of occupations that they didn't expect doing," said Corak.

The economical downturns seen successful Canada during the aboriginal 1980s and 1990s amusement the interaction of that scarring.

Youth unemployment reached a highest of 18.3 per cent successful 1983, and roseate again to 17.2 per cent successful 1992 and 1993, with existent wage declines observed among the 17 to 24 cohort successful the years afterward.

'I'm benignant of waiting for beingness to start'

The deficiency of opportunities for young radical aren't bully for the remainder of the state either, said Williams, the researcher. "Young radical are a treasure of assets that we request to enactment and besides output dividends from," she said.

Corak offers a antithetic perspective. "I'm not truthful definite that it impacts the system [so much] arsenic the quality of our system gets imprinted much intelligibly connected younger people," helium observed.

Some young people, helium noted, are doing precise good and earning much than their parents did, portion others are losing ground. "What we're seeing is galore young radical overmuch much stressed, and moving faster connected a treadmill to enactment still."

Lately, Gooch has been reflecting connected wherever his parents were astatine this signifier of their lives. By the clip they were successful their mid-20s, they were moving connected their careers, owned existent estate and were gathering a beingness together, helium said.

The young technologist hasn't fixed up connected his search — he's applying for jobs crossed the state and abroad, some successful and retired of his field. He's accepted that he doesn't cognize what his circumstances volition look similar successful a year.

"I don't person a afloat clip occupation yet, haven't started my career," helium said. "I'm benignant of waiting for beingness to start."