{"id":84783,"date":"2025-08-20T23:13:08","date_gmt":"2025-08-20T23:13:08","guid":{"rendered":"https:\/\/www.newsbeep.com\/ca\/84783\/"},"modified":"2025-08-20T23:13:08","modified_gmt":"2025-08-20T23:13:08","slug":"canadas-youth-jobless-rate-fueled-by-student-immigration-surge-bmo","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/ca\/84783\/","title":{"rendered":"Canada\u2019s Youth Jobless Rate Fueled By Student Immigration Surge: BMO"},"content":{"rendered":"

The kids are not alright, according to a new report from one of Canada\u2019s Big Six banks. Statistics Canada (Stat Can)<\/a> data shows the youth unemployment rate saw a sharp uptick in July, and has climbed to the highest level since 2010 (excluding pandemic). BMO<\/a> notes that rising unemployment is typical in a recession, but joblessness this concentrated in young adults is not. The bank warns this isn\u2019t due to a lack of demand for workers, but an excess supply of labour from the massive study permit boom.\u00a0<\/p>\n

Canadian Youth Unemployment Rate Is Soaring Faster Than General Joblessness<\/p>\n

Canada\u2019s youth unemployment rate is flying high, delivering a blow to the general economy. The seasonally adjusted youth unemployment rate climbed to 14.6% in July, a 0.4 percentage point increase from the previous month. BMO notes this is the highest rate since 2010, excluding the unusual distortion in the first year of the pandemic. This is very high, though nowhere near the record.\u00a0\u00a0<\/p>\n

\u201cBefore 2020, the highest youth jobless rate was set in 1982 at just above 20%. But that sky-high rate was accompanied by the highest overall jobless rate of the post-war era (13.1%),\u201d explains Douglas Porter, chief economist at BMO.\u00a0\u00a0<\/p>\n

Rising unemployment is typical of entering a recessionary environment, but this is very different from 1982. Canada\u2019s rising jobless rate is almost exclusively concentrated among young adults.\u00a0\u00a0<\/p>\n

Canadian Labour Markets Unable To Absorb Youth Population From Immigration Boom<\/p>\n

The 36-month percentage change of the youth population (annualized) vs the ratio of youth unemployment to workers 25 years and older.<\/p>\n

\"\"<\/a><\/p>\n

Source: Statistics Canada; BMO Capital Markets.\u00a0<\/p>\n

BMO compares the unemployment rate as a ratio to highlight just how concentrated the stress has become. \u201cOne way to drill down to the specific pressure on youth versus the overall population is to look at the ratio of the youth rate (14.6%) vs the rate for those 25 and over (5.7%), which is now around 2.5:1,\u201d explains Porter.\u00a0<\/p>\n

In plain English, Canada\u2019s young adults\u2014aged 15 to 24 and actively seeking and available for work\u2014are 150% more likely to be unemployed than workers aged 25+. Amplified youth unemployment was fueled by the study permit-driven immigration boom that occurred post-2022<\/a>.\u00a0<\/p>\n

Canadian Youth Unemployment: A Policy Decision, Not Economic\u2014But It Can Turn Into An Economic Issue<\/p>\n

The bank\u2019s above chart shows a clear correlation between the demographic\u2019s population boom and its amplified unemployment rate. Youth unemployment surges follow the rare and rapid growth of the demographic, the latter occurring during Canada\u2019s immigration booms.\u00a0<\/p>\n

\u201c\u2026unsurprisingly, when the youth population swells, it tends to drive up the youth jobless rate relative to others,\u201d he explains.\u00a0<\/p>\n

He further adds, \u201cThe past few years have seen extreme growth in the 15\u201324 category, largely due to the large influx of international students.\u201d<\/p>\n

Government documents show policymakers sought to grow aggregate demand by rapidly scaling study permit issuance<\/a>. As the data shows, it\u2019s easier to raise the number of permits than it is to absorb a flood of new labour. A very real problem, regardless of how many times a \u201clabour shortage\u201d is claimed. It\u2019s not an issue of too much demand for workers, but an excess supply of workers that aren\u2019t being absorbed.\u00a0<\/p>\n

Porter highlights this by rhetorically asking, \u201cIn one single 12-month period (to July 2024), the youth population surged by 7.2% y\/y\u2014is it any wonder the youth jobless rate then spiked?\u201d\u00a0\u00a0<\/p>\n

Beyond BMO\u2019s analysis, using immigration as a demand stimulus proved counterproductive,<\/a> concentrating spending on necessities and diverting capital from other sectors. The result is essentials\u2014especially shelter and food<\/a>\u2014see amplified price growth while discretionary spending takes a hit.\u00a0<\/p>\n

Since one person\u2019s spending is another person\u2019s income, the problem is likely to spread to other areas. Recent changes to immigration are preventing the problem from getting bigger<\/a>, but corrections tend to take years\u2014not months.\u00a0<\/p>\n

\n\tYou Might Also Like<\/p>\n","protected":false},"excerpt":{"rendered":"The kids are not alright, according to a new report from one of Canada\u2019s Big Six banks. Statistics…\n","protected":false},"author":2,"featured_media":84784,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[45,49,48,46],"class_list":["post-84783","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-business","tag-ca","tag-canada","tag-economy"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/84783","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/comments?post=84783"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/84783\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media\/84784"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media?parent=84783"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/categories?post=84783"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/tags?post=84783"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}