Youth Unemployment in Canada – Always higher

However, participation rates are only one part of young people’s experience of the labour market. A second major factor is whether youth are able to find employment once they enter the workforce.

The youth unemployment rate varied widely from 1946 to 2015. Relatively low until the mid-1950s, it climbed 5.9 percentage points from 1956 to 1958, peaking at 11.1%. While youth unemployment briefly dropped below 6% again in 1966 (5.6%), it was back up to 11.1% in 1971.

The unemployment rate for workers aged 15 to 24 rose further during the 1970s as the relatively large cohorts of baby boomers entered the labour market. Following the 1981–1982 recession, youth unemployment reached its highest point in 1983, when 19.2% of young workers were unemployed. The recovery of the Canadian economy from 1984 to 1989 led to a steady decline in youth unemployment through the rest of the 1980s. Youth unemployment rose in the early 1990s after the 1990–1992 recession, and again following the 2008–2009 recession. From 1990 to 2015, it remained between 17.2% (1992 and 1993) and 11.2% (2007).

The levels following the 2008–2009 recession were similar to those observed in the mid-1970s.

Regardless of the period considered, the youth unemployment rate has always been higher than the unemployment rate of older workers. The difference reflects a variety of factors. Whenever firms implement layoffs based on seniority rules, young workers are more likely to lose their job than their older counterparts. In addition, young workers are overrepresented in small firms, which tend to have higher-than-average layoff rates. Finally, at the beginning of their career, young workers change jobs more often than older workers, looking for a position whose requirements fit their skills. Such job searches sometimes entail some unemployment.

The result is that from 1946 to 2015, the youth unemployment rate followed similar patterns to the unemployment rate of older workers, but was always at least 1.6 times higher. The greatest disparities between the unemployment rates of youth and older workers occurred in the mid-1970s—when young people were just over 2.5 times as likely to be unemployed as older adults—and in 2012, when youth unemployment was 2.4 times higher than the rate for older workers.

Chosen excerpts by Job Market Monitor. Read the whole story at Canadian youth and full-time work: A slower transition