In many parts of the world, young people are happier than their elders. After all, they have health and years ahead of them.
But in Canada, it’s completely the opposite.
In our country, young people are less happy than old people. Much less. The gap that has been widening since 2010 is among the widest in the world, according to the World Happiness Report. Canada ranks 8th.e position for those 60 and over. But it slips to 58e rank for young people under 301.
Are young people right to be down in the dumps? When you look at the unemployment rate, yes.
Gen Zs are being hit hard by the slowdown in the job market. After the pandemic, this generation born between 1997 and 2012 may have felt like employment was a given, as employers were so short of workers.
Today, Zs are struggling to find work, as confirmed by figures released by Statistics Canada on Friday.
In July, the unemployment rate hit 14.2% for those aged 15 to 24, a 4.9-point increase from the low in the summer of 2022. The unemployment rate even reached 21.3% for recent immigrants aged 15 to 24, a huge jump from 14.2% in two years.
The youth unemployment rate has climbed at a speed seen only in recent recessions, as National Bank economists point out in a special study2.
So what’s going on?
Those trying to enter the job market are facing a hiring freeze. But the current struggles of job seekers could be the canary in the coal mine. Job vacancies have melted away at companies. And many sectors have surplus staff. So it wouldn’t be surprising if layoffs eventually hit the entire population.
But let’s get back to the young people…
Some would say they always suffer more when the job market tightens. Yes, but never as much as today, Royal Bank economists explain in a recent podcast3.
In fact, 80% of the deterioration in the unemployment rate of the entire population has been absorbed by young people under 35. This is disproportionate!
During the credit crisis of 2008 and the recession of the early 1990s, young people picked up 50 to 60 percent of the damage.
The situation is all the more serious because young people risk suffering long-term consequences on their careers. History shows that those who graduate when the job market is tough have a harder time moving up the ladder and can drag a wage gap for up to 10 years, according to TD Bank.4.
Nothing to reduce intergenerational inequities. Nothing to improve the financial situation of young people.
Already, inflation is hitting them harder, because a larger proportion of their spending is devoted to essential goods, such as housing and food, which have seen more pronounced price increases, indicates the Desjardins Group in a series of studies on young people.5.
And good luck buying a home! The housing market is the most unaffordable it has been since the 1980s, although falling interest rates offer some hope.
As we can see, young people are stuck.
In its latest budget, the Trudeau government tried to restore intergenerational equity… and to attract the young people who brought it to power in 2015, but who are now migrating to the Conservative Party.
Ottawa has released billions to stimulate house building. All well and good. But it will take years to bring real estate back down to earth.
In the meantime, we need to slow the growth of the population, which swelled by 1.3 million people in 2023, the fastest increase (+3.2%) since 1957. The federal government has committed to reducing temporary immigration. A good thing. We are not doing anyone any favours if young people and immigrants cannot find a roof over their heads and a job.
What more can be done for young people?
- Take the necessary steps to achieve our greenhouse gas reduction targets, because the climate crisis is jeopardizing their future.
- Investing to restore Canada’s productivity to boost the standard of living of future generations.
- Ensure that young people have the training they need to benefit from advances in artificial intelligence, rather than suffer the consequences.
- Keeping our public finances in order and tackling the deficit in maintaining public infrastructure which constitutes a hidden debt that we are leaving to our children.
No matter the means, intergenerational equity should be a beacon that guides all our public policies.
1. Check out the World Happiness Report rankings (in English)
2. Read the National Bank study
3. Listen to the Royal Bank podcast (in English)
4. Read TD Bank’s analysis
5. Consult a study from the Desjardins Movement’s youth series