CIBC on The Struggles of Canadian Youth Employment

09:45 AM EDT, 08/26/2025 (MT Newswires) -- The troubles faced by young people in Canada finding work aren't new, with their jobless rate having risen steadily since 2022, said CIBC.

However, the most recent step up has taken unemployment to levels typically only seen during recessionary periods and has come in contrast to a surprisingly resilient labor market for other age groups, wrote the bank in a note to clients.

In addition, there's no evidence that the 15-24 unemployment rate is being exaggerated by increased labor market participation, pointed out CIBC. Indeed, if anything, the employment-to-population ratio shows an even more worrying trend.

The increase in youth unemployment in recent years has gone above and beyond what the bank would have expected to see given the broader economic backdrop. While that is partly an oversupply issue stemming from a surge in the student population, other factors also appear to be at work.

For example, technological change -- including AI -- may be taking the place of part-time or entry-level jobs typically undertaken by young people.

The good news is that the factors driving youth unemployment higher at present shouldn't last forever, added CIBC. Population growth, particularly among non-permanent residents, is already slowing, meaning less

incremental supply needing to be absorbed into the labor market.

While new technologies, including AI, may be limiting demand for some student and entry-level roles, that same demographic group is most likely to work in fields using that technology and unlocking productivity benefits from it in

the future, according to the bank.

Technological advancements of the past, including for example, the personal computer and the internet, also had a negative impact on some roles, but those were offset in the longer term as jobs were created or enhanced in other areas.

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