Youth Employment in Canada

Post-recession, we are often asked about youth employment. On this page I keep various reports and tabulations I have prepared. At the bottom are some additional credible sources I have found.

Workforce Aging and the Labour Market Opportunities of Youth: Evidence from Canada (In submission)

With Sundip Dhanjal (Laurier MABE, 2014)
Abstract. In this study, we investigate whether an aging workforce affects the job opportunities of youth. Provincial data from the 1976-2013 Labour Force Surveys and a fixed-effects model is used to estimate the effect of the share of the adult male labour force that is aged 55 to 69 on the employment and unemployment rates of men aged 25 to 29. We estimate effects on other labour market outcomes including wages and school enrolment, and other samples of younger men and women. There is no evidence to suggest that a growing share of older workers negatively affects the decisions or outcomes of youth in the labour market. To the contrary, there is weak evidence to suggest an aging population has a positive effect on the labour market outcomes of youth.
CLSRN Working Paper No. 139.
LCERPA Working Paper No. 2014-9.

The Labour Market Activities of Canada’s Youth
Prepared for the House of Commons Standing Committee on Finance Study of Youth Employment in Canada, March 2014

What are youth today doing with their time? I looked at young people surveyed by Statistics Canada in the Labour Force Survey and categorized their activities. Focussing on young men 25-29, I find that young men have higher unemployment rates and shorter jobless durations than older men, but this is not because of the most recession. There are not substantial numbers of discouraged workers among youth, nor has it been more difficult for youth in recent years in the labour market. Furthermore, investments in higher education are not being wasted. Policy makers should focus on policies that correct market failures - such as providing market information and ensuring access to education and training for students from low-income families.

Report of the Standing Committee on Finance: Youth Employment in Canada: Challenges and Potential Solutions

Link to the briefing note with further information: here

Stata do-file to replicate my tabulations: here

Stata log file: here

Commentary in the Globe and Mail

A related article I wrote for the Globe and Mail:
No easy answer to underemployment of twentysomething men March 21, 2014.
The title is misleading, I didn't make it up.

Would you want to be in your mother's shoes?
Written for IRPP Policy Options, Public Square - May/June Issue

It is a difficult, if not impossible, task to judge whether one generation is better off than another. I argue this requires a full life-cycle approach and broad view of well-being to be meaningful. We will not know if today's youth are better or worse off than their parents until we see what the rest of their lives have to offer them.
While we can easily pick and choose statistics that pit one generation against another, this is not meaningful and in my opinion it is often counter-productive. In an effort to reasonably compare the situation of generations, I have been compiling some cohort life-cycle profile information.

Article Online: Public Square

Source document for all numbers mentioned in the article: here

Stata do files to replicate the tabulations: LFS SCF & SLID

Credible sources for more information

People like anecdotes, but we shouldn't base policy on anecdotes. There is a lot of junk out there, even more spin, and many don't have the statistical background to sort out the good and bad. Find someone with a solid statistics background and familiarity with available Canadian data before you believe anything you read. Never assume the US data applies here. The main problem is in finding comparable measures over time.

Beach and Finnie 2004: A Longitudinal Analysis of Earnings Change in Canada.
Using LAD, the authors map out age-earnings profiles by cohort (year turned 25). It is also published in the Canadian Journal of Economics. Unfortunately, the last entry cohort is 1996 (Gen X) and they are tracked to 2004. A great project would be to extend this if LAD makes it into the RDC, the SCF/SLID files above do that to some extent. It looks like wages when 25 are slightly lower with new generations but then the profiles are steeper - today's youth may end up much better off than their parents.

Uppal and LaRochelle-Cote April 2014 Overqualification among recent university graduates in Canada.
Important result is that today's youth are no more overqualified than in the past 20 years. More are educated and more are in professional positions. In my opinion, an important consideration is that an employer may value a person's education (university degree) and pay them more than what they would pay someone without a university degree, even though the job may not actually require the specific degree to qualify for the job. Many degrees offer skills and signals employers value, and pay for, but aren't easily measured.

Galarneau, Morissette & Usalcas, July 2013 What has changed for young people in Canada? A great overview of youth labour market outcomes over time. Unfortunately (for me) it does not present information to easily discuss generations.