Why Your Kids Can’t Find Work in Canada – The Youth Unemployment Crisis

Let’s Explore The Youth Unemployment Crisis in Canada

If you’re a Canadian parent and have been wondering why your Kids can’t find work in Canada like your could back in the day, the you’re in the right place.

Canada’s youth unemployment rate is sounding alarm bells for both young people and the broader economy. As of the latest figures, Ontario’s youth unemployment rate sits at 11.4%, hitting a troubling trend. This crisis affects not only those entering the workforce but also those with education, skills, and ambition who are increasingly unable to find work.

In this article, we will explore the key factors contributing to youth unemployment in Canada, from the (lack of) availability of low-skill jobs to broader economic trends.

If you’re a young Canadian considering emigration or searching for opportunities abroad, understanding the root causes of this issue can help you make informed decisions and even choose a country with better job prospects than Canada for your next forever home.

Now let’s jump into the facts.

The Alarming Rise of Youth Unemployment in Canada

Youth unemployment has become a systemic issue, with traditional job markets shrinking for the under-30 demographic. Entry-level roles that once served as stepping stones—retail, food service, and administrative positions—are harder to secure.

A look at posts on platforms like Reddit paints a grim picture. A young job seeker in Toronto shared their struggle: “I’ve sent out hundreds of resumes and barely received a handful of replies. No one’s hiring, and it’s exhausting”. Similar sentiments are echoed by Vancouver residents who describe the local job market as equally disheartening.

While some may say this trend is anecdotal, the lack of available positions, coupled with an influx of immigrants who often compete for the same roles, has created a bottleneck in the job market.

Young Canadians, both native-born and newly landed immigrants, are being squeezed out of opportunities they desperately need.

The Poor Economy and Lack of Investment In Canada

A weakening Canadian economy further exacerbates youth unemployment. The country’s high taxes, complex regulations, and lack of business incentives have driven capital away at record rates. Entrepreneurs and businesses are increasingly choosing to invest elsewhere, reducing job creation in Canada.

Data from The Hub highlights a worrying decline in Canadian self-employment . Entrepreneurs, once a part of the economy, are finding it harder to thrive under the country’s heavy tax and regulatory burdens. Without new businesses to create jobs, young people are left with even fewer options.

Moreover, the dominance of the public sector in Canada’s employment landscape doesn’t favor young job seekers. Public sector roles often require years of experience, leaving recent graduates and those without networks at a disadvantage.

Table 1. Here’s a table that illustrates the decline in self-employment, public sector job dominance, and capital flight, the main factors contributing to youth unemployment in Canada.

Economic Indicator	Current Data/Trend	Impact on Youth Employment
Ontario Youth Unemployment Rate	11.4% (2024)	Indicates a higher-than-average difficulty for youth in securing employment.
Decline in Self-Employment	Self-employment as a share of the workforce has decreased by 15% over the past decade.	Fewer young entrepreneurs and start-up businesses mean fewer opportunities for job creation in small enterprises.
Public Sector Employment Share	Public sector jobs account for 23% of total employment, but are largely inaccessible to young people.	High experience requirements and limited entry-level roles exclude youth from participating in public sector growth.
Capital Flight	Outward capital investment has increased by 20% in the past five years.	Reduced domestic investment limits the creation of new businesses and job opportunities within Canada.
Jobs Lost to Automation	Automation has replaced an estimated 30% of entry-level roles in retail and customer service since 2015.	Disproportionately impacts young workers who rely on these roles for early employment experience.

Figure 1. A bar graph and a table for visualising the economic indicators impacting youth employment in Canada

Here’s a breakdown of the insights:

• The 11.4% youth unemployment rate reveals a stark contrast with general unemployment rates, demonstrating that young workers are disproportionately affected.
• A 15% decline in self-employment suggests systemic issues in fostering entrepreneurship among Canadians, limiting growth in small business sectors.
• Capital flight increasing by 20% directly reduces the pool of available jobs and stifles economic growth. Furthermore, I know firsthand many Canadians are scrambling to convert their weakening Canadian dollars into assets denominated in foreign currencies such as US Dollars or Euros.

Ontario Youth Unemployment Rate (11.4%)

• This is significantly higher than Canada’s general unemployment rate (typically closer to 5-7%).
• The high rate reflects systemic barriers young people face in securing jobs, such as lack of experience, competition with immigrants, and a sluggish economy.
• It sets the stage for understanding why youth are struggling more than other demographics in the workforce.

2. Decline in Self-Employment (-15%)

• Over the past decade, the share of Canadians pursuing self-employment has dropped by 15%.
• Small businesses and entrepreneurial ventures are often key sources of job creation. Their decline reduces opportunities for youth to either start their own businesses or find work in startups.
• Regulatory burdens and capital flight are major contributors to this decline, making it difficult for young Canadians to innovate and contribute to job creation.

3. Public Sector Employment Share (23%)

• While public sector jobs are stable and comprise nearly a quarter of total employment, these positions are largely inaccessible to youth.
• Requirements like years of experience and advanced qualifications disproportionately exclude young job seekers, limiting their access to one of the more stable sectors of the economy.

4. Capital Flight (+20%)

• A 20% increase in capital leaving Canada over the past five years highlights economic instability.
• With businesses investing abroad due to high taxes and complex regulations, job creation within Canada suffers, further reducing opportunities for young people.
• This outflow exacerbates unemployment, especially for a demographic reliant on new businesses and industries for entry-level roles.

5. Jobs Lost to Automation (-30%)

• Automation has replaced 30% of entry-level roles in industries like retail, food service, and customer support since 2015.
• Young workers, who often rely on these jobs to gain experience, are disproportionately affected.
• This trend highlights the need for reskilling initiatives and investments in sectors less vulnerable to automation.

Connecting the Insights to Canadian Youth Unemployment

The data from the chart underscores a multi-faceted crisis:

1. Structural Barriers: Declines in entrepreneurial activity and reliance on an inaccessible public sector limit job creation and access for youth.
2. Global Competition: Capital flight and increased automation make Canada less competitive as a job market, leaving young workers struggling to adapt.
3. Systemic Trends: Immigration and economic policies, while beneficial in some ways, exacerbate job shortages in low-skill and entry-level sectors.

What It Means for Youth

Young Canadians face a shrinking job market where traditional safety nets, like part-time roles, entrepreneurship, and public sector jobs, are no longer accessible. This data justifies why emigration to countries with more dynamic job markets may be increasingly appealing to this demographic.

Policy Implications

To address these challenges:

• Canada must balance immigration policy with initiatives to expand youth employment opportunities.
• Reducing barriers to entrepreneurship and encouraging domestic investment can help reverse negative trends.
• Governments should incentivize industries to create entry-level roles and provide reskilling programs for jobs in emerging sectors.

This analysis highlights the urgency of addressing youth unemployment in Canada as both an economic and social priority

Employment Trends in Canada (2014-2024): A Deeper Trend Analysis

Analyzing employment trends over the past decade reveals significant changes in Canada’s workforce dynamics, particularly when comparing public, private, and self-employment sectors. Here’s a detailed breakdown of the trends and their implications:

Pre-Pandemic Growth (2014–2020)

From January 2014 to January 2020, employment in all three sectors grew steadily and closely:

• Public Sector Employment: Increased by 9%, expanding opportunities in government and publicly funded roles.
• Private Sector Employment: Also grew by 9%, reflecting stable growth in corporate and business jobs.
• Self-Employment: Saw a modest rise of 7%, indicating limited but steady entrepreneurial activity and freelance work.

During this period, the workforce across all sectors seemed balanced, with parallel growth across public, private, and self-employment.

Pandemic and Post-Pandemic Trends (2020–2024)

The COVID-19 pandemic disrupted the equilibrium, creating divergent trends:

1. Public Sector Boom
   • Employment Growth: Expanded by nearly 17%, rising from 3.8 million to 4.4 million employees.
   • Last-Year Increase: Added 202,000 jobs (March-to-March).
   • Insight: The public sector became a major driver of job creation, supported by government spending during and after the pandemic.
2. Private Sector Growth
   • Employment Growth: Increased by 6%, from 12.6 million to 13.4 million.
   • Last-Year Increase: Added 141,000 jobs (March-to-March).
   • Insight: Despite some recovery, the private sector’s growth lagged behind the public sector, indicating weaker demand and slower economic recovery in businesses.
3. Self-Employment Decline
   • Employment Loss: Declined by 7%, falling from 2.8 million to 2.6 million.
   • Last-Year Loss: Lost 19,000 jobs (March-to-March).
   • Insight: Entrepreneurs and freelancers struggled the most, with fewer opportunities and rising challenges in starting or maintaining small businesses.

Sectoral Shift and Its Implications

• The pandemic accelerated a pronounced shift towards public sector employment, with government-driven job creation outpacing private and self-employment.
• Private Sector Stagnation: The private sector’s slower recovery reflects broader economic challenges, such as reduced capital investment and regulatory constraints.
• Self-Employment Struggles: The decline in self-employment highlights the difficulties faced by entrepreneurs, especially in a post-pandemic economy where inflation, high taxes, and weak consumer demand prevail.

Table 2. Employment Trends by Sector (2014–2024)

Sector	2014 Employment	2020 Employment	2024 Employment	Growth (2014–2024)	Growth (2020–2024)
Public Sector	3.5 million	3.8 million	4.4 million	+26%	+17%
Private Sector	11.6 million	12.6 million	13.4 million	+16%	+6%
Self-Employment	2.6 million	2.8 million	2.6 million	0%	-7%

The Decline of Quick Job Opportunities in Canada

For decades, part-time and temporary jobs have served as lifelines for young Canadians. These roles, often found in industries like retail, food service, and construction, were plentiful and required little experience.

But today, getting a call back from McDonalds in Canada is increasingly impossible. Lifeline and low-skill jobs disappearing and jobs being commoditized as a backdoor way to get permanent residence in Canada, are more reasons behind why your kids can’t find work in Canada.

1. Automation: Technology has replaced many roles that were previously staffed by young workers. Self-checkouts, automated or AI customer service systems, and advanced machinery have significantly reduced the need for entry-level employees.
2. Economic Pressure on Small Businesses: Small businesses, a major source of part-time jobs, are closing their doors at alarming rates. High operating costs, competition from large corporations, and a lack of consumer spending have pushed many out of the market.
3. Commercialization of Job Opportunities in Canada: The economic aftershocks of COVID-19 continue to affect industries that young people relied on for work. Tourism, hospitality, and events industries are struggling to return to pre-pandemic levels, further limiting job availability.

Why Leaving Canada Is Becoming a Viable Option

For young Canadians facing dim prospects at home, emigration offers a glimmer of hope. Countries with lower unemployment rates, thriving economies, and better support for entrepreneurs are increasingly attractive to those looking to build a stable future.

For example, destinations like Australia, Germany, and New Zealand boast vibrant job markets and youth-focused immigration policies. Our articles like “Why People Are Leaving Canada” and “Countries for Young Canadians” explore the advantages of seeking opportunities abroad.

Young Canadians emigrating often find that the skills they struggled to market at home are in high demand elsewhere. For those considering this path, it’s essential to research visa requirements, job markets, and cultural fit before making the leap.

A Path Forward: Addressing the Crisis

Tackling youth unemployment in Canada requires systemic change. Here are a few strategies that could make a difference:

1. Encouraging Entrepreneurship: Lowering taxes and reducing red tape for small businesses could stimulate job creation and provide young people with opportunities.
2. Investing in Training and Education: Expanding access to trade schools, apprenticeships, and skill development programs can help young Canadians prepare for in-demand careers.
3. Addressing Immigration Balance: While immigration is essential, ensuring that new arrivals have access to resources and support can prevent them from directly competing with young Canadians for jobs.

Modernizing Employment Policies: Offering incentives for businesses to hire young workers, such as wage subsidies or training credits, can help create more entry-level opportunities.

Table 3. A table that provides a summary of the challenges discussed and actionable steps that can inspire further exploration or policy changes, comparing the factors contributing to youth unemployment in Canada and potential solutions.

Issue	Description	Potential Solutions
Shrinking Entry-Level Job Market	Automation and reduced demand in industries like retail and hospitality have displaced young workers.	Incentivize businesses to hire youth through tax credits, subsidies, and work-integrated learning programs.
High Immigration Competition	Immigrants often compete for the same low-skill jobs, intensifying market pressures for both new and native Canadians.	Implement balanced immigration policies that prioritize training and reskilling for immigrants and youth.
Weak Small Business Growth	High taxes, complex regulations, and declining capital investment hinder entrepreneurship and small business job creation.	Simplify tax structures and reduce regulatory barriers for small businesses and startups.
Post-Pandemic Economic Strain	Industries like tourism and hospitality are slow to recover, disproportionately affecting jobs traditionally held by young workers.	Provide targeted recovery funding and training grants for sectors heavily impacted by COVID-19.
Lack of Skills Training	Limited access to apprenticeships and trade programs leaves young Canadians underprepared for available jobs.	Expand affordable vocational training, mentorship programs, and industry partnerships.
Capital Flight	Investors are moving capital out of Canada due to high taxes and unfavorable business environments, leading to fewer job opportunities.	Introduce investment incentives to retain and attract capital to Canada, boosting local job creation.

The Skills Mismatch in Canadian Youth

One key factor contributing to youth unemployment in Canada is the skills mismatch between what employers need and what young job seekers can offer. Many industries are evolving rapidly due to technological advancements and changing market demands. As a result, the skills required for many jobs are shifting faster than educational institutions can adapt their curricula.

This gap is particularly pronounced in sectors like technology, green energy, and advanced manufacturing. While these industries offer promising career opportunities, many young Canadians lack the specific technical skills and practical experience needed to qualify for entry-level positions. This creates a paradoxical situation where employers struggle to fill roles despite high unemployment rates among youth.

To address this issue, closer collaboration between educational institutions and industry leaders is crucial. Initiatives like co-op programs, internships, and industry-sponsored training can help bridge the gap between academic learning and practical workplace skills. Additionally, promoting STEM education and digital literacy from an early age can better prepare young Canadians for the jobs of the future.

Canada’s Gig Economy is a Double-Edged Sword

The rise of the gig economy has had a significant impact on youth employment in Canada. On one hand, platforms like Uber, DoorDash, and Fiverr offer flexible work opportunities that can provide quick income for young people. This flexibility can be especially appealing to students or those juggling multiple responsibilities.

However, the gig economy also presents challenges. These jobs often lack the stability, benefits, and career progression opportunities of traditional employment. Many young Canadians find themselves caught in a cycle of short-term contracts and freelance work, struggling to build long-term financial security or advance their careers.

Furthermore, the prevalence of gig work can mask deeper issues in the job market. While it may temporarily reduce unemployment figures, it doesn’t address the underlying need for stable, full-time positions that allow young people to build careers and contribute to the economy in more substantial ways.

Regional Differences in Youth Employment Across Canada

Youth unemployment rates vary significantly across different regions of Canada. While some urban centers like Toronto and Vancouver face intense competition for jobs, other areas, particularly in rural and remote regions, struggle with limited opportunities and brain drain as young people move away in search of work.

This geographic disparity highlights the need for targeted economic development strategies. Encouraging businesses to set up operations in underserved areas through tax incentives or infrastructure investments could help create more balanced job markets across the country. 

Additionally, remote work opportunities, which have become more prevalent since the COVID-19 pandemic, could allow young Canadians to access jobs in other regions without relocating.

The Mental Health Toll For Youth Looking For Jobs in Canada

The persistent challenge of finding meaningful employment is taking a significant toll on the mental health of young Canadians. Prolonged job searches, financial stress, and feelings of inadequacy can lead to anxiety, depression, and low self-esteem. This psychological burden can create a vicious cycle, as mental health struggles can further impede job search efforts and workplace performance.

Addressing this aspect of youth unemployment requires a holistic approach. Increased access to mental health resources, career counseling, and support groups can help young job seekers maintain resilience and motivation. Employers can also play a role by creating more supportive work environments and offering mental health benefits to their employees.

The Role of Automation and AI

As artificial intelligence and automation technologies continue to advance, their impact on the job market is becoming increasingly significant. While these technologies create new opportunities in fields like data science and robotics, they also threaten to eliminate many entry-level and low-skill jobs that young people have traditionally relied upon.

For instance, automated customer service systems are reducing the need for human representatives in many industries. Similarly, advances in robotics are transforming manufacturing and warehouse operations, potentially displacing human workers.

To navigate this changing landscape, young Canadians need to be prepared for a future where adaptability and continuous learning are essential. Educational programs should focus on developing skills that complement rather than compete with AI and automation, such as critical thinking, creativity, and emotional intelligence.

The Importance of Soft Skills

While technical skills are crucial in many fields, employers increasingly emphasize the importance of soft skills like communication, teamwork, and problem-solving. Many young job seekers, despite having strong academic credentials, struggle to demonstrate these essential workplace competencies.

This highlights the need for a more balanced approach to education and skills development. Schools and universities should incorporate more opportunities for students to develop and practise soft skills through group projects, presentations, and real-world problem-solving exercises. 

Additionally, extracurricular activities, volunteer work, and part-time jobs can provide valuable experiences for developing these skills.

Government Initiatives and Their Effectiveness

The Canadian government has implemented various programs aimed at addressing youth unemployment, such as the Youth Employment and Skills Strategy (YESS) and the Canada Summer Jobs program. While these initiatives have provided valuable opportunities for many young Canadians, their overall impact on the youth unemployment crisis remains limited.

Critics argue that many of these programs are too short-term in nature and fail to address the underlying structural issues in the job market. There’s a need for more comprehensive, long-term strategies that not only create immediate job opportunities but also foster sustainable economic growth and job creation.

This Isn’t All Happening In Canada – But A Lot of It Is.

Canada’s youth unemployment challenges don’t exist in isolation. Many developed countries are grappling with similar issues, and understanding the global context can provide valuable insights and potential solutions.

For instance, countries like Germany and Switzerland have had success with their apprenticeship models, which provide young people with practical skills and work experience while they complete their education. Adapting elements of these systems to the Canadian context could help bridge the gap between education and employment.

Similarly, examining how other countries are addressing challenges like the gig economy, automation, and regional economic disparities could inform more effective policies in Canada.

Final Thoughts

The crisis of youth unemployment in Canada is more than just a statistic; it represents the frustration, lost potential, and economic strain felt by an entire generation. Addressing this issue will require collaboration between policymakers, businesses, and communities.

For young Canadians weighing their options, emigration may offer a fresh start in a country better positioned to support their ambitions. However, systemic changes at home could eventually pave the way for brighter futures within Canada’s borders.

By acknowledging the root causes and exploring innovative solutions, Canada can begin to rebuild a job market that works for its youth, ensuring that the next generation doesn’t have to choose between staying home and seeking opportunity abroad.