Bank of Canada reports youth job market still challenging

External Deputy Governor at the Bank of Canada, Nicolas Vincent says the job market continues to be particularly challenging for young people.

In a speech on Tuesday, Vincent suggested that Canada needs to rethink approaches to education and training. This comes as young people continue to face a labour market with low turnover and high long-term unemployment.

He says young people are overrepresented in the ranks of the unemployed, making up almost a quarter of the long‑term unemployed, a share that has more than doubled since 2022.

People aged 15 to 24 contribute to the rise in long‑term unemployment, exceeding what was seen during the recession in the early 1990s and in the global financial crisis of 2008–09.

“Young people tend to work in sectors that are sensitive to swings in the economy, such as retail or culture and recreation,” Vincent says. “In 2022, the jobless rate for people aged 15 to 24 was nine per cent, the lowest on record. Nearly four years later, it’s above 14 per cent, marking the biggest rise in unemployment among workers of all ages. Teenagers have been affected the most.”

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Earlier this month, Statistics Canada reported that the unemployment rate rose to 6.9 per cent in April, up from 6.7 per cent in March.

Vincent’s speech focuses on expanding trade to help affected workers transition to other sectors, upgrade or broaden their skills and closely monitor the rapid evolution of artificial intelligence.

“Traditionally, central banks respond to cyclical ups and downs in the economy by raising or lowering the policy interest rate. Our aim in doing so is to influence demand so that inflation remains low and stable,” Vincent says. “When faced with structural change, even though we can support the economy to some degree during periods of restructuring, we can’t choose its final destination. Our goal remains to ensure inflation is low, stable and predictable.”

“By honouring this commitment, the bank will help workers, businesses and governments focus on adapting and on finding opportunities in the profound changes that we face,” he says.

For more information, the Bank of Canada is releasing a financial stability report on Thursday.

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