This is my latest column for Canadian Business magazine.
Giorgio, a hard-working, smart-as-a-whip University of Toronto student, asked me a great question after a recent guest lecture: What if the biggest challenge facing Canadian businesses and governments in the coming years isn’t an aging society but the economic and fiscal drag of hundreds of thousands of young people who can’t find meaningful work?
Like many young adults, Giorgio and his friends plunged into graduate school at the recession’s start to duck unemployment, up-skilling to boost their chances of cracking a market littered with experienced boomers. Lucky Giorgio got a job in construction for the coming summer. It ’s not his intended career, but it will help pay off student debts. His friends are not so fortunate. Most are doing unpaid internships to enhance resumés while relying on barista and other minimum-wage work to keep on keeping on. None of them see anything but short-term jobs, at best, in their future.
The odds of developing a career and a full-fledged adult life are getting longer for this crowd. Three years ago, the global economic crisis triggered the worst nine-month spate of job-shedding in Canada since the Great Depression. And while overall numbers have rebounded, young people are locked out of the recovery.
Canadians under 25 lost just over half of all the jobs that evaporated between October 2008 and July 2009. Since then, the head count of job holders has surpassed the pre-recession level by 1%—but not among young people. There are 25,000 fewer of them working paid jobs today than in July 2009.
They haven’t given up. At last count, 414,000 young adults were looking for work. And, in truth, there is always more unemployment among youth than in the rest of the labour force. They’re still figuring out how to sell themselves to prospective employers, and are likelier than others to leave a job in search of a better one. But at 14.7%, the unemployment rate for those under 25 is now double the national rate—a first since StatsCan began annually tracking the data in 1976.
Ironically, this growth in unemployment stems largely from the type of jobs that have been created since the downturn: four out of five are temporary. The vast majority of the new permanent jobs, meanwhile, have gone to workers aged 55 and older, partly because employers get more immediate value out of staff with experience.
So what did the kids do? They went back to school. About 150,000 people under 25 left the labour market between the fall of 2008 and 2009—a time during which post-secondary institutions registered almost as many new students, the single biggest increase in enrolment (save for Ontario’s double-cohort year).
Young people are trying every trick in the book, but talking with Giorgio and others reveals a quiet anxiety. It’s echoed in a recent Ekos poll, which found that among those younger than 42—the median age of Canada’s population—59% believe the quality of life for the next generation will be worse than that enjoyed by today’s. Some are calling it the end of progress.
This erosion of confidence is neither inevitable nor necessarily self-fulfilling. In 25 years, the boomers who want to work or have to work will have vacated the job market, and Giorgio’s age group may see their survival instincts and sheer ingenuity rewarded with previously denied prosperity.
But any smart business can see what’s around the corner. Today, the world is chasing capital, trying to get investors to put money into their idea, their community. Tomorrow, the global hunt will be for labour. Emerging and developed economies alike are facing aging workforces and shrinking pools of skilled and unskilled labour. Attracting youth and cultivating new talent now could put your company ahead in the upcoming competition for people. That’s how you ensure your markets and profits grow, not shrink. But if we wait too long to invest in giving the next generation a fair try, instead of a grey tsunami we may be facing the revenge of the temps.