Opinion: Young Canadians are staring at a bleak future of diminished economic prospects

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Lisa Lalande is chief executive of Century Initiative. Pedro Barata is executive director of the Future Skills Centre.

At 11.3 per cent, the unemployment rate for Canadians aged 15 to 24 is double that for the country overall. Young people are struggling to find jobs, and without proactive solutions their economic prospects could not only be significantly eroded for years, but may never recover.

Economic shocks such as the pandemic or a recession can have a lasting influence on all of us, even when conditions get “back to normal” and government responses recede. When people are laid off, unable to find work or otherwise face setbacks in tough economic times, the effects on their earnings and career progression can leave labour market “scars.” For example, accepting lower quality work initially, as is often done during downturns, can decrease the quality of a person’s employment over time, accounting for up to half their continued loss in earnings after a recession.

Given recent scarring, young Canadians are facing some of the strongest headwinds in the long term. Discrimination and personal circumstances can further shape and amplify challenges.

Earlier this year, the Century Initiative’s 2023 National Scorecard on Canada’s Growth and Prosperity identified that the amount of young people not in employment, education or training (NEET) grew in 2021 to 15.3 per cent, increasing from levels at the start of the pandemic and hitting its highest point since 2010.

That’s why the two organizations of this column’s authors, Future Skills Centre and Century Initiative, have been leading a project to identify proactive solutions that could reduce the risk of labour market scarring for young people. The ideas detailed in a new report include ways to develop interventions and scale successful approaches that address gaps in support.

It’s understandable that most policy responses focus on the immediate, short-term consequences of economic shocks. While this is important, maximizing prosperity and inclusion for all Canadians requires solutions that address less visible longer-term effects, too.

Many of the support gaps arise because young people facing labour market scarring may not be aware of or eligible for services that could help them. Free career counselling is often only offered to students in postsecondary education or adults who have been laid off from full-time employment. Expanding the places where such services can be obtained, and supporting career guidance professionals to help people navigate different phases of their working life, could help more young people reach their goals.

One possibility, building on models in Belgium and the Netherlands, would be for the Canada Training Credit to support people with career guidance whenever it makes sense for them, as part of a more robust and enhanced system.

Relationships can also be critical to career pathways, but many young people lack a professional network to help them identify and land opportunities. Governments, employers and labour and other work force development organizations must join together to scale up or create opportunities for networking, job shadowing, mentoring and building social capital.

Future Skills Centre, for example, has funded Evergreen’s Future City Builders program, which brings young people together to design healthier and more equitable cities. The program lets participants gain knowledge and skills that make them more employable now and in the future. Alumni have said that the networking increased their comfort in engaging with professionals and opened doors in their careers.

Governments and employers can also collaborate to create more chances for young people to get work experience and avoid resume gaps after economic shocks. This can include a greater emphasis on work-integrated learning and expanding beyond the technical roles where opportunities are currently concentrated.

With an aging population and a growing number of workers retiring, Canada’s prosperity depends on helping all young people participate in the labour market at their highest potential. This is not an insurmountable problem. By supporting young people with policies and programs that will help stabilize them through economic shocks and beyond, governments and partners in the private and not-for-profit sectors can help ensure they are not left behind.