Canada’s Youth Job Market Is Deteriorating as Unemployment Remains Above Pre-Pandemic Levels

Canada’s youth job market is showing renewed signs of weakness, with employment falling for two consecutive months and unemployment among young people remaining significantly higher than pre-pandemic levels. The latest figures from Statistics Canada reveal that young Canadians are facing a more difficult transition into employment, raising concerns about their financial independence, career prospects and long-term economic security.

The deterioration is particularly concerning for people aged 15 to 24, including students, recent graduates and young workers trying to secure their first stable jobs. Although some indicators improved during the summer, the latest employment figures suggest that the recovery remains fragile.

amazon UP TO 90% OFF Today's Mega Deals & Limited Time Offers!

Shop Now

Canada’s youth unemployment rate remains elevated

According to Statistics Canada’s September 2026 Labour Force Survey, the unemployment rate among Canadians aged 15 to 24 stood at 13.0%, compared with 10.8% on average during the 2017–2019 pre-pandemic period.

The national unemployment rate was 6.5% in September, meaning young people were experiencing unemployment at approximately twice the overall rate.

The figures also show that the problem is not limited to a single month. Youth unemployment increased substantially between 2023 and 2025 and has remained elevated throughout much of 2026.

Youth employment has declined for two consecutive months

The September figures reveal a particularly worrying development: the number of employed young Canadians fell by 48,000, representing a monthly decline of 1.8%.

This followed another decrease in August, when youth employment dropped by 19,000.

Together, the two months resulted in a loss of approximately 67,000 youth jobs, equivalent to a 2.4% decline. This erased the employment gains recorded between April and July.

The latest figures highlight several important trends:

Indicator	September 2026 result
Youth unemployment rate (15–24)	13.0%
Pre-pandemic unemployment average	10.8%
Youth employment decline in September	48,000
Youth employment decline in August and September	67,000
Two-month employment decline	2.4%
Overall Canadian unemployment rate	6.5%

Source: Statistics Canada, Labour Force Survey, September 2026.

www150.statcan.gc.ca+1

The figures suggest that young workers are particularly exposed to changes in hiring conditions. While employment across the Canadian economy increased between April and July, the subsequent losses among younger workers reversed those gains.

There is another detail worth considering. The number of young people participating in the labour force also declined by 50,000 in September. This means the fall in employment was accompanied by a reduction in the number of young people working or actively looking for work.

Consequently, the unemployment rate alone does not tell the entire story. Some young people may stop searching after repeated unsuccessful applications, meaning they are no longer counted as unemployed under the standard labour force definition.

Why are young Canadians struggling to find jobs?

The deterioration is linked to several pressures identified by the Canadian government, although no single factor explains the entire situation.

In its discussion paper, Building Canada Strong: Youth in the Labour Market, Employment and Social Development Canada identifies three important challenges: population growth, weaker hiring demand and changes in the labour market.

1. More young people are competing for available positions

Canada’s youth population has expanded rapidly.

According to the federal government’s analysis, the population aged 15 to 24 increased by 9.9% between 2022 and 2024, representing approximately 457,000 additional people.

By comparison, Canada’s overall population grew by 6% during the same period.

A larger number of young people entering the labour market means more competition for entry-level positions, particularly when employers are not increasing recruitment at the same pace.

This pressure is especially relevant for students and recent graduates who have limited professional experience and are often competing for the same opportunities.

Gobierno de Canadá

2. Hiring has weakened in sectors that traditionally employ young workers

Retail, wholesale trade, accommodation and food services have traditionally provided important entry points into the Canadian workforce.

These industries offer opportunities for people who are still studying, have recently graduated or are looking for their first professional experience.

However, Employment and Social Development Canada identifies softer hiring demand in these sectors as one of the factors contributing to higher youth unemployment.

When businesses become more cautious about recruitment, young applicants can find themselves competing for fewer available positions.

This creates a difficult situation for people who need employment to gain experience but cannot obtain that experience without first being hired.

3. Changes in the labour market are creating additional uncertainty

Artificial intelligence and technological developments are changing the way employers organize their workforces.

The federal government’s discussion paper refers to preliminary research suggesting that younger workers in certain AI-exposed occupations may face employment disadvantages compared with more experienced workers.

However, this should not be interpreted as proof that artificial intelligence is responsible for Canada’s youth unemployment problem.

The evidence cited by the government includes research conducted in the United States, and the precise impact of AI adoption on Canadian youth employment remains uncertain.

Nevertheless, the possibility that entry-level tasks could increasingly be automated raises questions about how young Canadians will acquire the experience needed to progress into more advanced positions.

Gobierno de Canadá

Nearly one million young Canadians are outside education, employment or training

Unemployment figures are only one part of the problem.

Another indicator highlighted by the federal government is the number of young people classified as NEET, meaning they are not in education, employment or training.

According to Employment and Social Development Canada’s discussion paper, approximately 914,000 Canadians aged 15 to 29 were in this situation in 2025.

That represented 11.5% of the population in this age group.

The government also reported an increase of approximately 201,800 people in this category since 2023.

Why does this matter?

Being outside education, employment and training can make it harder for young people to develop professional skills, build work experience and establish a stable career.

It can also create financial difficulties, particularly for those who cannot rely on family support or other sources of income.

The NEET indicator should not be confused with unemployment. It includes people who are not actively seeking work, as well as those who are neither studying nor participating in formal training.

The figures nevertheless reveal a broader challenge: a significant number of young Canadians are struggling to establish a connection with either education or the labour market.

Gobierno de Canadá

The impact could extend beyond the first years of employment

Difficulty finding a first job is not necessarily a temporary inconvenience.

The Canadian government’s analysis warns that prolonged unemployment during the early stages of a career can have consequences that continue for years.

One of the concerns is known as wage scarring.

This describes the potential long-term financial disadvantage experienced by people who enter the labour market during difficult economic conditions or spend extended periods unemployed.

For young workers, the consequences can include:

Delayed professional development and career progression.
Lower earnings compared with people who entered the workforce under better economic conditions.
Fewer opportunities to gain practical experience.
Greater difficulty securing stable, long-term employment.
Financial dependence on family members for longer periods.

The federal discussion paper also highlights potential consequences for mental health and quality of life.

These effects are particularly concerning because early employment often provides the foundation for future financial independence.

A young person who cannot find work after graduation may struggle to build savings, afford housing or meet other living expenses. Even after securing employment, a delayed start to their career can affect their financial position over time.

The government cites research on the longer-term consequences of economic downturns, including the 2008–2009 recession, to illustrate why youth unemployment deserves particular attention.

Gobierno de Canadá

Are there any signs of improvement?

The situation is not uniformly negative.

Statistics Canada’s August 2026 Labour Force Survey showed that the unemployment rate among young people was 12.9%, compared with 14.3% in August 2025.

The employment rate for youth was also 1.2 percentage points higher than a year earlier.

There was also some improvement in the summer employment situation for returning students.

Between May and August, the average unemployment rate among returning students aged 15 to 24 was 15.9%, compared with 17.9% during the same period in 2025.

These figures suggest that some indicators improved compared with the previous year.

However, the September decline in youth employment shows that this improvement has not translated into a consistently stronger labour market.

It is therefore more accurate to describe the situation as a fragile recovery with renewed monthly deterioration than to suggest that every youth employment indicator is worsening.

The distinction matters: year-over-year comparisons and month-to-month changes measure different aspects of the labour market.

www150.statcan.gc.ca+2

What can young Canadians do in a difficult job market?

Although broader economic conditions are outside an individual’s control, there are practical steps that can help young jobseekers improve their prospects.

Look beyond traditional entry-level positions. Apprenticeships, internships, paid training and work-integrated learning programmes can provide experience that employers increasingly expect.

Develop transferable skills. Communication, problem-solving, digital literacy and project management can be valuable across multiple industries.

Consider sectors with different recruitment needs. Healthcare, skilled trades, technology and other professional services may offer opportunities depending on qualifications, location and employer demand.

Use public employment services. Canada’s employment support programmes can help eligible young people access career guidance, training and employment opportunities.

Avoid relying exclusively on online applications. Networking, career fairs, professional associations and direct contact with employers can help applicants discover opportunities that are not always widely advertised.

Young jobseekers should also pay attention to the quality of employment, not simply whether a position is available. Stable working conditions, relevant experience and opportunities for progression can be more valuable over time than accepting a position that offers little professional development.

Our assessment: Canada’s youth employment problem requires a stronger response

The latest figures point to a structural challenge that deserves greater attention from policymakers, employers and educational institutions.

Canada cannot rely on economic growth alone to solve youth unemployment. Young people need realistic opportunities to enter the workforce, gain experience and build careers without spending years moving between temporary positions and unsuccessful applications.

The federal government’s own analysis acknowledges the pressures created by population growth, weaker hiring demand and changing workplace requirements. The rise in the number of young people outside education, employment or training adds another reason for concern.

In our assessment, improving access to entry-level employment should be a priority. Employers need to consider how they recruit inexperienced candidates, while governments should strengthen pathways connecting education, vocational training and paid work experience.

The September figures do not establish that Canada’s entire labour market is collapsing. However, the combination of elevated youth unemployment, declining employment and a growing NEET population shows that young Canadians are facing a particularly difficult economic environment.

The challenge is not simply helping young people find their first job. It is ensuring they have a genuine opportunity to build a sustainable professional future in Canada.