Canada is facing a growing youth unemployment crisis, as the latest data from Statistics Canada reveals the jobless rate for young people aged 15 to 24 has climbed to 14.7% in September 2025, the highest in over 15 years, excluding the pandemic period. This surge in youth unemployment has sparked a heated political debate between the Conservative and Liberal parties, with both sides offering sharply different approaches to solving the problem. While the Liberals defend their ongoing programs, the Conservatives are calling for training reforms, labour mobility incentives, and better education-to-employment alignment.

With the economy slowing and population growth outpacing job creation, experts warn that inaction could shape an entire generation’s career prospects for decades to come.

The Core Issue: Education and Employment Misalignment

One of the central problems highlighted in the debate is the growing disconnect between education and job market demand. According to Statistics Canada, 18.2% of young Canadians with post-secondary education are currently employed in fields unrelated to their studies, a figure that has increased by 1.6 percentage points compared to last year.

Conservative MP Garnett Genuis emphasized that many young workers graduate with degrees in areas that don’t match labour shortages. “There’s a misalignment between education and the jobs market,” he said, adding that this mismatch is leaving graduates underemployed or unemployed altogether.

The Conservatives have proposed a new funding model for the Canada Student Financial Assistance Program, which would adjust student grants and loans based on the employment outcomes of various fields of study.

The Conservative Plan – Training and Housing for Young Workers

In response to the rising unemployment, the Conservatives are urging the federal government to adopt a comprehensive plan focused on job training reform and labour mobility.

Their proposal includes:

• Increased support for education in high-demand fields, such as healthcare, technology, and skilled trades.
• Allowing businesses in regions facing worker shortages to deduct the costs of building housing for employees, helping youth relocate more easily for work.
• Reducing reliance on the Temporary Foreign Worker Program (TFWP) by filling vacancies with Canadian youth first.

According to Genuis, these changes would encourage companies to hire locally while making it easier for young people to move to regions where jobs are available. “Secure and comfortable housing available on site or close by makes relocation so much easier,” he said.

The Liberal Response: Existing Youth Employment Strategies

The Liberal government, however, argues that it already has a robust plan in motion to support youth employment.

Jennifer Kozelj, press secretary for Jobs Minister Patty Hajdu, said the Liberals are “acting with urgency and purpose” to help young Canadians build stable careers.

Key initiatives under the Youth Employment and Skills Strategy include:

• The Canada Summer Jobs Program has created thousands of seasonal positions for youth.
• A 40% temporary increase in Canada Student Financial Assistance funding for low-income students, extended through the current academic year.
• A November 2025 national conference with provinces and territories to coordinate new strategies for youth workforce development.

Kozelj dismissed the Conservative plan as a “recycled version of old ideas,” arguing that the Liberals’ approach is better suited to the realities of today’s workforce.

Economic Factors: Population Growth and Labour Market Strain

Beyond politics, economists point to structural challenges. A Bank of Canada report released in June 2025 identified rapid population growth, particularly through immigration as one of the factors driving higher unemployment among both youth and newcomers.

Meanwhile, a Desjardins report in September suggested that current youth unemployment levels are consistent with those seen during past recessions. The report also predicts that as Canada’s immigration intake slows, youth employment may begin to recover, provided targeted skills programs are introduced.

The Way Forward: Investing in Youth Skills and Mobility

Experts agree that the long-term solution lies in bridging education with employability. Canada must invest in career-oriented training, apprenticeships, and international credential recognition to ensure both local and immigrant youth can thrive in the same job market. Reforming post-secondary programs to match labour market demand particularly in healthcare, trades, and digital sectors will be key.

The Conservatives’ call for credential recognition could also help internationally trained workers find relevant roles faster, preventing them from competing with young Canadians for entry-level jobs.

As Genuis stated, “This isn’t just about unemployment numbers. It’s about ensuring that the next generation of Canadians can build meaningful careers without being priced out of opportunities.”

The Future of Canada’s Workforce Depends on Its Youth

The rising youth unemployment rate of 14.7% signals a deeper problem within Canada’s labour system, one that requires cooperation across political lines. While the Liberal government continues with its student funding and youth job initiatives, the Conservatives are pressing for structural reforms that align education, housing, and employment. Whether through expanded training programs or better job mobility, the next few months will determine how Canada’s leaders respond to this growing economic challenge.

At ImmigCanada, we remain committed to delivering accurate insights into the Canadian immigration and labour market landscape, helping both newcomers and residents stay informed and prepared for the evolving job market.