Report offers some excellent reasons to stay in school
We knew young people were having a hard time keeping jobs and finding new ones since the 2009 recession. But a TD Economics report by Francis Fong shows just how bad the job market still is:
“The economic recovery has been almost non-existent for younger Canadians (those aged 15-24 years). They accounted for more than half of all net job losses during the recession and employment still stands some 250,000 below its pre-recession peak. In contrast, jobs held by those over the age of 25 years are more than 400,000 above its level prior to the downturn.”
The 14.7 per cent youth unemployment rate doesn’t look that bad, but it masks a troubling trend. Many aren’t counted in the figure, because they’ve given up looking for work:
“Countless youth have become have become discouraged by both the lack of opportunity and the difficulty of getting their foot in the door. Many have simply stopped trying.”
When young people do find jobs, they’re paying a post-recession penalty in the form of lower wages. Graduating in an era of high-unemployment can have lasting effects on pay:
It has been estimated that a one percentage point increase in the unemployment rate equates to an initial wage loss of 6-7 per cent and that it can take anywhere from 10 to more than 15 years to close that gap.
Even retailers don’t provide the instant (if low-paid) jobs they once did. They’d rather hire Grandma.
“…many older Canadians are delaying retirement and preventing job vacancies from building. Case in point is the retail sector, an industry traditionally associated with younger part-timers, but is now where older workers (those aged 60 years and over) have begun to increase their footprint.”
The good news? The recessionary job losses for youth weren’t as bad as those during past crises:
“The disproportionate share of job losses among youths was more glaring during both the 1980s and 1990s downturns where upwards of 77.5 per cent of the total job losses were borne by younger workers.”
…or nearly as bad as they continue to be in Europe:
Relative to their international peers today, Canadian youths are also faring better. In some of the worst hit countries in Europe such as Spain, Greece, or Ireland, youth unemployment rates have reached as high as 51.4 per cent. In Canada, it is 14.5 per cent.
It’s not just Fong who has noticed the lopsided recovery. Today’s Labour Force Survey highlighted the trend too: “Employment in February fell among youths aged 15 to 24, while it increased among people aged 55 and over. For those aged 25 to 54, employment was unchanged.”
But don’t freak out, young students. Educated Canadians much fare better. Statistics Canada reports that in February, 75 per cent of Canadians with university degrees were employed, compared to 70 per cent of those with certificates or diplomas and 60 per cent of those with high school only.
Click here to see average pay and employment rates by degree for Ontario’s class of 2008.