Young, educated workers today are earning more than in previous generations, according to a new report from Desjardins.
But it’s not all rosy for young Canadians, with women in particular facing declining mental health and ongoing barriers in the labour market.
The new report from Desjardins is the first in a series looking at how young Canadians are faring in today’s economy.
“The narrative around how young people are faring tends to have a negative tone,” said Randall Bartlett, senior director of Canadian economics for Desjardins and co-author of the report.
“What we found in the data was a lot more room for optimism.”
The report builds on recent census data that showed the Canadian population is highly educated, with a larger proportion of people holding a post-secondary degree than any other G7 country.
Desjardins found young Canadians are more educated today than in the past, with more of them holding college certifications and bachelor’s degrees than many of the countries in the Organization for Economic Co-operation and Development (OECD).
That has implications for earnings, given that those who complete a post-secondary education tend to earn more money throughout their lifetime.
For the report, Desjardins compared the earnings of Canadians who graduated with a bachelor’s degree in 1991 versus in 2001.
They found the younger cohort earned several thousand dollars more each year, adjusted for inflation, than those who graduated a decade earlier, suggesting the return on education is rising.
There are also more young people from lower-income families pursuing post-secondary education today than in previous generations. For those who come from families in the bottom 20 per cent of income earners, enrolment increased 28 per cent. That’s compared with a 10 per cent increase in enrolment for young Canadians from families in the top 20 per cent of income earners.
However, the report found that there are very real challenges in the labour market for young people as they move from school to the workplace.
Young women, for example, were facing declining mental health even before the pandemic hit, while young people in general saw their mental health decline significantly during the pandemic.
Women also continue to disproportionately carry the burden of caring for a child or family member.
“If you look at adults ages 25 to 44, women report caring for children as the primary reason for working part-time, while it barely registers for men the same age,” the report said.
Working fewer hours or leaving the labour market can result in lower earnings, which explains some of the wage gap between men and women.
The report also highlights that young immigrants are doing better in the labour market than they have historically, but they still face challenges putting their skills to work.
Desjardins chief economist and lead report author Jimmy Jean said these findings have implications for policymakers in Canada.
The first is the important role subsidized childcare programs can play in helping women rejoin the labour market. Quebec, which has had subsidized childcare for over 20 years, has seen more women join the labour force during that time.
Jean said the federal government’s pursuit of a national childcare program, which aims to deliver childcare that costs on average $10 a day, is a good start.
“(But) it needs to be made widely and easily accessible, without having to go through the long waiting time. So the execution of it will be crucial going forward,” he said.
Addressing mental health would also be a “very worthwhile investment,” he said, noting that poor mental health can affect young people’s abilities to successfully transition into the workforce.
The other consideration for policymakers, Jean said, is how to make it easier for immigrants to get their foreign credentials recognized.
Amid labour shortages, various governments across Canada are moving to ease credential recognition, particularly for health care workers.
This report by The Canadian Press was first published April 17, 2023.
OTTAWA – Canada’s unemployment rate held steady at 6.5 per cent last month as hiring remained weak across the economy.
Statistics Canada’s labour force survey on Friday said employment rose by a modest 15,000 jobs in October.
Business, building and support services saw the largest gain in employment.
Meanwhile, finance, insurance, real estate, rental and leasing experienced the largest decline.
Many economists see weakness in the job market continuing in the short term, before the Bank of Canada’s interest rate cuts spark a rebound in economic growth next year.
Despite ongoing softness in the labour market, however, strong wage growth has raged on in Canada. Average hourly wages in October grew 4.9 per cent from a year ago, reaching $35.76.
Friday’s report also shed some light on the financial health of households.
According to the agency, 28.8 per cent of Canadians aged 15 or older were living in a household that had difficulty meeting financial needs – like food and housing – in the previous four weeks.
That was down from 33.1 per cent in October 2023 and 35.5 per cent in October 2022, but still above the 20.4 per cent figure recorded in October 2020.
People living in a rented home were more likely to report difficulty meeting financial needs, with nearly four in 10 reporting that was the case.
That compares with just under a quarter of those living in an owned home by a household member.
Immigrants were also more likely to report facing financial strain last month, with about four out of 10 immigrants who landed in the last year doing so.
That compares with about three in 10 more established immigrants and one in four of people born in Canada.
This report by The Canadian Press was first published Nov. 8, 2024.
The Canadian Institute for Health Information says health-care spending in Canada is projected to reach a new high in 2024.
The annual report released Thursday says total health spending is expected to hit $372 billion, or $9,054 per Canadian.
CIHI’s national analysis predicts expenditures will rise by 5.7 per cent in 2024, compared to 4.5 per cent in 2023 and 1.7 per cent in 2022.
This year’s health spending is estimated to represent 12.4 per cent of Canada’s gross domestic product. Excluding two years of the pandemic, it would be the highest ratio in the country’s history.
While it’s not unusual for health expenditures to outpace economic growth, the report says this could be the case for the next several years due to Canada’s growing population and its aging demographic.
Canada’s per capita spending on health care in 2022 was among the highest in the world, but still less than countries such as the United States and Sweden.
The report notes that the Canadian dental and pharmacare plans could push health-care spending even further as more people who previously couldn’t afford these services start using them.
This report by The Canadian Press was first published Nov. 7, 2024.
Canadian Press health coverage receives support through a partnership with the Canadian Medical Association. CP is solely responsible for this content.
As Canadians wake up to news that Donald Trump will return to the White House, the president-elect’s protectionist stance is casting a spotlight on what effect his second term will have on Canada-U.S. economic ties.
Some Canadian business leaders have expressed worry over Trump’s promise to introduce a universal 10 per cent tariff on all American imports.
A Canadian Chamber of Commerce report released last month suggested those tariffs would shrink the Canadian economy, resulting in around $30 billion per year in economic costs.
More than 77 per cent of Canadian exports go to the U.S.
Canada’s manufacturing sector faces the biggest risk should Trump push forward on imposing broad tariffs, said Canadian Manufacturers and Exporters president and CEO Dennis Darby. He said the sector is the “most trade-exposed” within Canada.
“It’s in the U.S.’s best interest, it’s in our best interest, but most importantly for consumers across North America, that we’re able to trade goods, materials, ingredients, as we have under the trade agreements,” Darby said in an interview.
“It’s a more complex or complicated outcome than it would have been with the Democrats, but we’ve had to deal with this before and we’re going to do our best to deal with it again.”
American economists have also warned Trump’s plan could cause inflation and possibly a recession, which could have ripple effects in Canada.
It’s consumers who will ultimately feel the burden of any inflationary effect caused by broad tariffs, said Darby.
“A tariff tends to raise costs, and it ultimately raises prices, so that’s something that we have to be prepared for,” he said.
“It could tilt production mandates. A tariff makes goods more expensive, but on the same token, it also will make inputs for the U.S. more expensive.”
A report last month by TD economist Marc Ercolao said research shows a full-scale implementation of Trump’s tariff plan could lead to a near-five per cent reduction in Canadian export volumes to the U.S. by early-2027, relative to current baseline forecasts.
Retaliation by Canada would also increase costs for domestic producers, and push import volumes lower in the process.
“Slowing import activity mitigates some of the negative net trade impact on total GDP enough to avoid a technical recession, but still produces a period of extended stagnation through 2025 and 2026,” Ercolao said.
Since the Canada-United States-Mexico Agreement came into effect in 2020, trade between Canada and the U.S. has surged by 46 per cent, according to the Toronto Region Board of Trade.
With that deal is up for review in 2026, Canadian Chamber of Commerce president and CEO Candace Laing said the Canadian government “must collaborate effectively with the Trump administration to preserve and strengthen our bilateral economic partnership.”
“With an impressive $3.6 billion in daily trade, Canada and the United States are each other’s closest international partners. The secure and efficient flow of goods and people across our border … remains essential for the economies of both countries,” she said in a statement.
“By resisting tariffs and trade barriers that will only raise prices and hurt consumers in both countries, Canada and the United States can strengthen resilient cross-border supply chains that enhance our shared economic security.”
This report by The Canadian Press was first published Nov. 6, 2024.
