Canada’s Gen Z is entering adulthood under a cloud of economic uncertainty, facing one of the most severe youth job crises in more than two decades. New data from Statistics Canada reveals the unemployment rate for Canadians aged 15 to 24 has surged to its highest level since the 1990s, excluding the exceptional circumstances of the COVID-19 pandemic.
The spike in youth joblessness is being driven by a combination of rising inflation, a cooling job market, and record population growth. Recent graduates say the optimism that typically follows convocation has quickly given way to frustration and financial stress.
Sarah Chung, 23, earned her honours degree in media and communications from the University of Calgary but has yet to find work in her field. She’s now considering returning to school. “It’s bleak,” she said, citing inflation and political uncertainty as major concerns.
The economic turbulence began with a post-pandemic hiring boom that soon faded as the Bank of Canada hiked interest rates to combat inflation. That pullback, combined with record immigration levels and older workers clinging to jobs longer, has severely limited opportunities for young Canadians trying to gain a foothold in the workforce.
According to Brendon Bernard, a senior economist at Indeed, “Hiring enthusiasm has cooled,” and young workers—typically the newest and least experienced—are often hit the hardest.
Stories like Ben Gooch’s are becoming increasingly common. A mechanical engineering graduate from McMaster University, Gooch says he’s applied to more than 100 jobs with no luck. For now, he’s sweeping floors at a garden center just to get by. Thivian Varnacumaaran, an electrical engineering student, says he’s submitted 400 to 500 job applications—with no offers.
Economists warn that the long-term effects of entering the job market during a downturn can be profound. Known as “wage scarring,” young professionals who start their careers under such conditions often earn less over time and are more likely to land in underpaid or unstable roles. Charles St-Arnaud, chief economist at Alberta Central, noted that youth are frequently the first to be let go during economic contractions due to the “last in, first out” nature of layoffs.
While the federal government recently announced additional placements through the Canada Summer Jobs program, many experts argue that these efforts fail to address the structural barriers young Canadians now face.
For graduates like Gooch, the delay in launching a meaningful career feels personal and painful. “I don’t have a full-time job yet, haven’t started my career,” he said. “I’m kind of waiting for life to start.”
As youth unemployment continues to rise, economists warn that it’s not just a generational challenge—it’s a signal of deeper cracks forming in Canada’s labour market.