Directorate for Employment, Labour and Social Affairs

Canada’s youth labour market outperforms most OECD countries but a small group is left behind

 

11/06/08 - The recent performance of the youth labour market in Canada is very good compared with most other OECD countries, according to the just-released OECD report on Jobs for Youth: Canada. Sustained economic growth and a very flexible labour market by international standards have contributed to rising employment rates and falling overall unemployment for all, including for youth.

The employment rate among 15 24 year olds rose to 59.5% in 2007, up from 51.5% in 1997, and well above the OECD average of 44% for both years (see Table A).  During the same period, the youth unemployment rate decreased from 16% to 11%, thus below the 2007 OECD average of 13%.  The long-term youth unemployment incidence is particularly low in Canada, at 2% in 2007, compared with an OECD average of 20%.

The transition from school to work is smooth for most young Canadians, though it varies from province to province. Some youth living in remote and rural areas and most Aboriginal youth living on reserves still have a hard time finding jobs and are more likely to be excluded from society.

Canada combines a high youth employment rate with the highest proportion in the OECD of young people attending university or college. Its secondary school drop-out rate, at 8.7% in 2005, is far lower than the 13% OECD average. However, Aboriginal youth and low school achievers are over-represented among early school-leavers, particularly in booming provinces such as Alberta. There are simply too few vocational programmes to help them to stay in high school.

Access to jobs for youth is strengthened by a comparatively lax employment protection legislation (EPL) that encourages employers to hire youth. Indeed, most youth enter the job market with a low wage, particularly when combining school with work, and tend to move rapidly into higher paying jobs. However, the report notes that while combining education with work may be beneficial in the long-run for youth, working too many hours on the job can encourage teenagers to drop out of school.

Despite these impressive outcomes in the youth labour market, more could be done in Canada to strengthen the education and labour market policies to provide a smoother transition from school to work and ensure youth can move the career ladders. In particular, the government should take steps to discourage early school leaving and should smooth the school to work transition for marginalised youth. Existing youth programmes should be redirected towards those who face multiple barriers to sustainable employment. In addition, active intervention targeted on young repeat users of Employment Insurance (EI) and social assistance benefits should prevent them from becoming long term benefit recipients.

Recent reforms, both at the federal and at the provincial levels, go in the right direction. To accompany such policies, the OECD report recommends further action specifically targeted at helping at risk youth. Among the recommendations are the following:

  • Consider gradually increasing the school-leaving age to 18 together with the development of high-school vocational programmes.
  • Achieve a better balance of work and study among teenagers to prevent them from dropping out of school.
  • Enforce “mutual obligations” so young repeat users of EI benefits report on their job-search efforts and, after three months on EI, get help finding work.
  • This could include geographic mobility assistance programmes to help youth, especially from rural and remote areas, to move to other areas where suitable job opportunities exist
  • Better co-ordinate the federal Youth Employment Strategy, in particular, the Skills Link stream devoted to disadvantaged youth, with the existing provincial programmes designed to help at-risk youth living in underserved and very often remote and rural areas.
 

Jobs for Youth: Canada (Des emplois pour les jeunes : Canada), is the latest in a series of OECD reports on youth employment policies which now covers sixteen countries.

Journalists can obtain a copy from the OECD’s Media Division (tel: + 331 45 24 97 00) For further information, journalists are invited to contact Anne Sonnet (anne.sonnet@oecd.org) or Vincent Vandenberghe (vincent.vandenberghe@oecd.org)  of the OECD’s Employment Analysis and Policy Division.

 

 

 

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