Thank you for having me.
Young Canadians have been sold a bill of goods. They've been told that if they take the initiative to get a higher education there would be a well-paying, secure job that would follow to pay back their student loans with ease and that they would enjoy higher income over their lifetimes.
Unfortunately, young Canadians are facing a very different reality. Despite accounting for less than 20% of the labour force, Canadians aged 15 to 24 accounted for over 50% of the 430,000 jobs lost during the recent recession. By fall 2013, only 56,000 of the net new jobs created since 2009, a mere 0.5%, have gone to young Canadians.
Since 2009, the Canadian economy has created over one million jobs. In order to keep pace with the population, however, the economy would have needed to create an additional 280,000 jobs. This, along with the financial impact of more established workers, has increased competition for the jobs that have been created, with Statistics Canada now reporting that there were 6.3 unemployed Canadians for every job opening. Unfortunately, the jobs being created in Canada are increasingly falling into the precarious work category as they have lower or stagnant wages, few with any benefits, and little security compared to previous years. Even more troublesome is the growing trend of youth being forced to work for free through unpaid internships. It is estimated that there will be up to 300,000 unpaid internship positions in Canada this year.
While quality, well-paid jobs have been harder to come by since the recession, tuition fees at post-secondary institutions across the country have continued to rise at levels above inflation. Average tuition fees during the 2008-09 academic year were $4,700. Fast forward five years, a mere five years, and that amount has risen by over $1,000 to $5,700 per year.
As of July 2012 there were 1.1 million borrowers with outstanding Canada student loans. Over half of those were in repayment and 17% of those in repayment could not make the full payments required under the law. In Canada post-secondary education costs are roughly double the OECD average. If this trend continues, children born in 2011 should expect to pay over $139,000 to obtain a four-year degree.
Current outstanding student debt in Canada is estimated to be at $28.3 billion according to Statistics Canada. High levels of debt are impacting young Canadians' ability to integrate and participate in the broader economy upon graduation. Young Canadians are waiting longer than ever before to buy a house or start a family and with mounting student debt levels the prospects of entrepreneurship are well out of reach. These impacts will have, in turn, a greater effect on the broader economy as it is estimated that over the next two decades, $23.1 billion will be foregone in lost wages or long-term wage scarring of Canadian youth as a result of youth under- and unemployment.
Increasing competition for available jobs disproportionately favours older workers with more experience. Part of the reason for this is that employers are failing to provide on-the-job training. Investments in employee training have dropped 40% since 1993. While previous generations had access to on-the-job training, if young Canadians want to gain training and experience outside of the classroom, it's becoming more common to be forced to do so by working for free, often through unpaid internships. These internships favour students with little or no student debt and or young Canadians from higher-income backgrounds as they can afford to forego an income. However, for those with high levels of debt or from lower-income backgrounds, they often end up either underemployed or working outside of their field, which often contributes to degradation of their skills and a loss of networking opportunities.
Canada's youth unemployment rate was close to 14%. While this is already double the rate for all Canadians, it's important to note that if this rate actually accounted for all those individuals involuntarily working in precarious jobs, those who aren't getting the hours that they desire, graduates who are returning to school who can't find employment, or young Canadians being forced to work for free or unpaid internships, this number would actually jump to 27%. In fact, of all OECD nations, Canada now holds the dubious honour of having the largest proportion of university graduates earning less than the national median income.
In order to address the issue of youth unemployment and intergenerational inequality our federation, the Canadian Federation of Students recommends that the federal government develop a strategy to address youth unemployment, underemployment, and unpaid internships that includes as a first step collecting relative employment data on recent graduates, working with the provinces to create employment standards for precarious work and internships as well as the ability to enforce those standards, and eliminating the practice of unpaid internships within the federal government's agencies.
Thank you.