Human Resources Committee on Nov. 4th, 2025

[The Chair (Robert Morrissey (Egmont, Lib.)), Liberal, Bobby Morrissey]

Good morning, committee members. It is 11:01, and the clerk has advised me that we have quorum. Those witnesses who are appearing virtually have been sound-tested and approved.

With that, I will open meeting number 13 of the Standing Committee on Human Resources, Skills and Social Development and the Status of Persons with Disabilities. Pursuant to the motion adopted on September 18, 2025, the committee is meeting on youth employment in Canada.

Today's meeting is taking place in a hybrid format, pursuant to the Standing Orders. Members and witnesses are appearing by Zoom, as well as participating in the room.

I'll review a few items before we begin.

Everyone has the option to participate in this meeting in the official language of their choice. In the room, please familiarize yourself with the interpretation device. Those appearing virtually, if you click on the globe icon at the bottom of your screen, you can choose the official language of your choice. If there is an interruption in translation services, please get my attention by raising your hand, and we'll suspend while they are being corrected. As well, members in the room, please silence your devices so that they do not ring during the meeting. To ensure the safety of our interpreters, avoid tapping on the microphone boom. As well, please direct all questions through me, the chair. Wait until I address you by name before you proceed.

Today, we have two one-hour panels with two witnesses appearing in each one. In the first panel, we have, as an individual, Pierre Fortin, professor, department of economics, Université du Québec à Montréal. The second witness, who is appearing in the room, is Ms. Tiessen, chief economist with The Canadian Shield Institute for public policy.

Welcome.

Each one of you will have five minutes or less for an opening statement. When you get to five minutes or a little over, I will thank you and will expect you to conclude your comments shortly after that.

We'll begin with Professor Fortin for five minutes or less.

Professor, you have the floor.

[Pierre Fortin, Professor, Department of Economics, Université du Québec à Montréal, As an Individual]

Mr. Chair and members of the committee, I want to begin by thanking you for your kind invitation. I'm very honoured.

As a macroeconomist, I'll look at youth unemployment as a whole.

The first thing to observe is that the national unemployment rate in Canada has increased by two points in the last 30 months, going from 5% to 7%. This is due first to high interest rates and then to greater trade uncertainty. The hiring rate has slowed down, and many workers have been hurt.

If we are focusing on the youth labour force, there are four questions to ask. First, by how much has its unemployment rate increased? Second, by how much has this increase exceeded that of the unemployment rate of mature adults? Third, how much higher than in the past has this excess of youth unemployment been, and fourth, why so?

I will offer answers to these four questions.

Between the summer of 2023 and the summer of 2025, the unemployment rate for older adults increased by 1.2 percentage points. Meanwhile, the unemployment rate for people aged 15 to 24 increased by 4 percentage points. Therefore, the increase in the unemployment rate in this category is three and a half times higher.

There's nothing new about this trend. When hiring slows down, youth unemployment always rises more than that of older adults. The labour market always follows the last in, first out rule.

Is this time different? Is the 2023-25 magnification factor of 3.5 times for the increase in youth unemployment worse than in earlier job setbacks?

Definitely yes. Checking on this with Statistics Canada data, in the 40 years from 1976 to 2015, the magnification factor for youth unemployment was a modest 1.2 times the mature adult rate on average, but then, in the last 10 years, from 2016 to 2025, this factor has risen to 2.6 times on average and has included the above-mentioned shoot-up to 3.5 in the last two years.

Why has the spillover of the job decline on the youth unemployment rate been so large since 2016? The most likely cause is the explosion of immigration to Canada, especially since 2022.

Each year, about three-quarters of any new cohort of immigrants enlarges the pool of people who are looking for a first or a second job. In recent years, the huge increase in immigration has blown up the total number of new workers who compete for entry in the labour force and who are the most vulnerable to rising unemployment whenever the economy slows down.

In the labour force in 2016, there were about 25 new mature immigrants for every 100 youths, but by 2025, the ratio had gone up from 25 to 70 new mature immigrants per 100 youths. This is a story about supply and demand. The inevitable consequence has been that the unemployment rates of both groups have increased sharply to nearly 12% for new immigrants and 15% for youth respectively in recent months.

In other words, it is the open door immigration policy enforced during 2016 to 2024 that has made both the new immigrants and the young natives suffer from sky-high unemployment rates as soon as jobs have become scarcer.

Thank God our immigration policy has now begun to turn around toward a more moderate pace. The youths and the immigrants will benefit.

Thank you very much.

[The Chair, Liberal, Bobby Morrissey]

Thank you.

I understand that Ms. Bednar is going to give the opening report for the Canadian Shield Institute.

Madam Bednar, you have five minutes, please.

[Vasiliki Bednar, Managing Director, The Canadian SHIELD Institute]

Thank you, Chair. I'll share the time with our chief economist.

Good morning. My name is Vass Bednar. I am the managing director of The Canadian Shield Institute for public policy. We're a new think tank focused on securing economic sovereignty for Canada. I'm also the former chair of the expert panel on youth employment, which was back in 2016-17. I am joined by our chief economist at Shield, Kaylie Tiessen, who is able to be in the room with you. We've both been following this file for many years.

You may be wondering how economic sovereignty connects to youth employment. We, like you, want to ensure that young people can fully participate in, shape and benefit from our domestic economy. We're worried about what current trends mean for the sense of belonging that young people feel and their ability to build the lives they'd like. If the substitution of AI tools and technologies for new hires is effectively erasing a rung on the career ladder, a place where Canadians can learn and fail and grow, we do risk alienating a generation. Employers have changed too. They spend less on training and don't really offer jobs that require no experience. This leads us to that classic question of how young people gain experience in the first place.

Ironically, generation Z is ready for the AI economy. They are adaptive. They are digitally fluent. They are willing to learn. However, we are starting to see evidence that we're automating away many of the opportunities that can let them prove that. As you know, the youth unemployment rate has risen sharply, even without an official recession. That is unusual. It is a strong signal that something structural is breaking down in how young people enter the workforce. New data from Desjardins, Statistics Canada, the private sector and, yes, The Canadian Shield Institute all point to a disturbing trend: For the first time since the 1990s, young Canadians are both working less and earning less when they are working.

We see three forces at play. First, that entry-level ladder is missing rungs. Global job postings for roles that require zero to two years of experience are down nearly 30% since last year, 2024. Employers are automating junior tasks, cutting public sector internship budgets and inflating credential requirements so that young workers just don't qualify. They are also reducing apprenticeship opportunities in skilled trades even as the labour shortage becomes more acute.

Second, AI and automation are changing who gets a first chance. Early-career workers in AI-exposed fields like software, marketing and customer services are already seeing job loss. Meanwhile, those in the trade or care sectors, where AI complements rather than displaces human skills, are doing a little bit better.

Third, 40% of Canadian workers, including young and recent graduates, are overqualified for the job they have. This is a statistic that shows Canada's workers are underemployed, not underskilled. If we keep defining this kind of situation for young people as being a skills problem, we will continue to be focused on the wrong solutions.

I'll turn it over to Kaylie for three directions on policy.

[Kaylie Tiessen, Chief Economist, The Canadian SHIELD Institute]

Thanks, Vass.

Behind these stats are the stories we all hear—graduates applying for 500-plus jobs and never getting a response, job fairs with lineups around the block and applicants competing not just with each other but actually with AI screening bots to get seen by a potential employer. The result is what one analyst has called “AI versus AI”—job seekers using AI to tailor résumés for algorithms that screen them out anyway. It's brutal. This is a broken matching system. It erodes confidence and risks creating a lost generation of underemployed young Canadians.

Policy solutions to support youth employment typically focus on the supply side of things, such as skilling, but what if the demand for labour has fundamentally shifted? That's the side of the ledger that policy should be focusing on.

We would emphasize three directions for policy. One, bridge the gap between learning and earning. Co-op and apprenticeship programs see more demand than supply. That means more young people want a co-op than are actually available for young people to take. Firms need to provide opportunities that young people are seeking. Support the implementation of a vocational education and training model for apprenticeships. This has stabilized youth employment in Germany and Switzerland. It's worth looking at.

Two, modernize hiring and labour market systems. Incentivize Canada's businesses, large and small, to actually hire and train youth instead of automating them away. There are other things we can use AI for that would be a lot more useful. Experiment with transparent, randomized lottery pilots for internships and fellowships to reduce gatekeeping and selection bias. Design a nationwide system to assess the skills that young workers actually have instead of relying on credentials that signal something but not everything.

I'm seeing that's our time. We have more to say, but we'll get to that in questions.

Thank you very much.

[The Chair, Liberal, Bobby Morrissey]

Thank you, Ms. Tiessen and Ms. Bednar.

We'll now go to questioning, beginning with Mr. Genuis for six minutes please.

[Garnett Genuis, Conservative, Sherwood Park—Fort Saskatchewan, AB]

Thank you very much, Chair.

Thank you to the witnesses.

We've highlighted the Conservatives' youth jobs plan. It's what we've put on the table and proposed to the government in terms of confronting the youth unemployment crisis. The four parts of it are unleashing the economy, fixing immigration, fixing training and building homes where the jobs are.

My questions in this round will be for Mr. Fortin.

First, I want to highlight, Ms. Bednar, that I appreciated your point about the overqualification of many young people. I think it's important to understand that we're dealing with a situation in which there are not enough jobs. There are issues of training misalignment, and there are issues of not enough jobs. Some on this committee would like to focus purely on the idea that we need more training, but in reality, we're seeing a lot of young people who are highly trained. There are misalignments in training, but there are also simply not enough jobs. There's an important role for discussing the issues around training, but the first point of our plan is to unleash the economy so that there are enough jobs for young people.

Mr. Fortin, thank you for your work on this and for your testimony, which highlighted that there is a multiplier, sadly. When the unemployment rate is going up overall, the youth unemployment rate is generally going up by more. You've also highlighted how that magnification effect is getting greater. It has been wider over the life of this government than it was in previous times, but it is progressively widening. That's very alarming to me, and I think that should be alarming to all Canadians, seeing this further magnification. You've attributed that to immigration.

I'd like to start off on the issue of how unemployment overall affects youth unemployment. Again, going back to our plan, number one is to unleash the economy and number two is to fix immigration. It sounds like you need to fix unemployment overall. You need to address the problems of an overall lack of investment and a lack of economic growth if you want to address youth unemployment as well. Would you agree with that?

[Pierre Fortin]

Yes, of course. Right now, the Bank of Canada has reduced interest rates, which encourages economic activity, on the one hand. On the other hand, however, it is clear that the tariff attack on Canada has consequences for companies' tendency to invest more or less.

What needs to be done to stimulate the economy? I think my mother, who is in heaven, would have the best suggestion to make. She would have said that prayer is the way. Right now, not much can be done to control the Americans' behaviour toward Canada and other countries.

In the meantime, it's also a matter of encouraging the Governor of the Bank of Canada to continue to perhaps lower interest rates even further.

[Garnett Genuis, Conservative, Sherwood Park—Fort Saskatchewan, AB]

I appreciate the acknowledgement that there are some things we can't control. I would say that there are some things we can control, as well, when it comes to the state of our own economy. We're going to be affected by things we can control and by things we can't control. Either way, certainly you've argued that our own domestic policy decisions are affecting that magnification effect.

Could you explain a bit more about how the immigration choices that have been made by the government have led to intensifying competition and therefore to higher levels of unemployment for both newcomers and young people? How are the immigration policies of the government affecting this magnification where, at a given unemployment rate overall, the youth unemployment rate is even relatively higher?

[Pierre Fortin]

Canada's immigration policy launched around 2016-17 has clearly had all kinds of consequences. Until last year, Canada had the highest immigration rate in the world. As a result, the country experienced an explosion in migration, but the government did not anticipate that this would have such a significant impact on the unemployment rate during a slower phase of the economic cycle. As you say, and as I also emphasized, not only young people are affected by this very large entry policy for newcomers, who are obviously looking for a first job here. The policy also affects immigrants themselves. Those are the two groups that are suffering from the increase in unemployment. In that sense, immigrants themselves are victims of Canada's immigration policy.

We know that the Minister of Immigration, Refugees and Citizenship who was in office last year, Mr. Miller, as well as Ms. Diab, who succeeded him this year, have introduced measures to moderate this immigration policy. Obviously, I think it's a step in the right direction. The question is whether it will go far enough to restore the economy to the peaceful level it was at before 2016. We'll see.

[The Chair, Liberal, Bobby Morrissey]

Thank you, Mr. Fortin and Mr. Genuis.

Ms. Koutrakis, you have the floor for six minutes.

[Annie Koutrakis, Liberal, Vimy, QC]

Thank you, Mr. Chair.

My questions will be for Ms. Bednar and Ms. Tiessen.

In your opening comments, Ms. Bednar, you said many things that caught my attention, but for one in particular, I think I would like to give you the opportunity to expand on so that we have a better understanding. When you say there's something “structural” wrong, what exactly are you referring to?

As it pertains to government policy that is in place or is not in place, do you think the government's policies that are in place currently help the youth? We are putting a lot of effort into skills and a lot of effort into making sure the youth have the supports in place that they require to succeed, whether they come out of a trade school or whether they come out of university. I'm interested to know more about something being structurally wrong.

[Vasiliki Bednar]

One of our observations is that, through policy, we tend to focus, as you noted, on supply side interventions, on what are the skills competitions, skills training and supports for young people.

Our observation is that demand for the labour of young people is fundamentally shifting. If we're not recognizing that shift in demand, if we're not doing more to stimulate and incentivize firms to be hiring young people and providing those opportunities, we are risking leaving a layer of the workforce behind, and that's around some of the commentary with productivity-enhancing technologies that tend to see a substitution against a new hire, somebody who is more junior.

Kaylie, I don't know if you want to add anything.

[Kaylie Tiessen]

I would love to. Thank you very much.

There are a couple of policies that I didn't get to, so I'm going to get to those first, and then we'll go on to a few other things.

Stop assuming that companies will build the opportunities that young workers and new graduates want, and start requiring that firms build the opportunities that young workers want. That's where we need to start going with this conversation. It's not about creating more skills. We have an incredibly highly skilled workforce in this country, including young people. We need to be creating opportunities that actually increase our well-being because we're actually being utilized and challenged at work. It's increasing productivity, as well, in the economy. We need both of those things.

If we look at the role the immigration policy has played in the last few years, we see that we ended up focusing on a low-wage strategy. That's not what we need in order to create better jobs, in order to increase well-being and in order to increase productivity. We need a high-wage strategy that creates better jobs that actually meet the demands of young people and the rest of the workers in this country who want the opportunity to use the skills they have.

For too long, Canada's policy environment has assumed that the demand side for labour is exactly right, while workers, the supply side, have been required to consistently guess what employers want and when they want it. We're always guessing; they're always perfect. It's time to look at the demand side of the ledger and ask employers to consider revamping the types of opportunities they're creating.

There are a couple of other things that we could look at. One is system-wide assessments for skills, competencies and abilities to help governments and employers understand the workforce beyond the credentials that are on their résumés. There are a lot of things that we can do to prove the skills we have, but there are a lot of skills we have that don't have credentials, so let's make sure that we're able to recognize both.

We could also talk about manager training to help employers learn to recognize and leverage the potential skills within their teams instead of just always looking at cost-cutting, which is supposedly efficiency but actually is reducing productivity. They need to build pathways for workers to build skills over time instead of requiring five years of experience right off the bat.

[Annie Koutrakis, Liberal, Vimy, QC]

Thank you.

In your opinion, Ms. Tiessen or Ms. Bednar, is this a government policy letdown of our youth, or is it a private sector situation? Does it go back to the current economic instability? Where would you say lies the biggest percentage of blame? I'm saying “blame” for lack of a better word, but I'm not looking to blame. I'm trying to get to the root cause—or possibly one of the root causes—that has led us to this current situation. Is it a government deficiency, is it the private sector or is it a combination of both?

[Vasiliki Bednar]

I suppose we would say that it's so difficult to divorce the youth unemployment context from all of those factors.

Back when I was chairing the expert panel on youth employment, I was already hearing from young people about how they knew that rudimentary algorithmic systems were screening their CVs. They were using white font to put keywords from job postings into their cover letters and their résumés. That was a function of how technology was changing the search for labour. It drove down the cost of looking for a job. You didn't have to find a job posting in the newspaper or post it on a window. Everybody was applying for jobs from the couch, 24-7—you know what I mean—just online, and suddenly it was imposing a huge cost on employers as well. They were just inundated with interest from people, which leads to this disappointment in the hundreds of applications and disappointment that we hear from.... We can never divorce youth employment from the broader context. We know that young people are the last ones in the labour market and sort of the first ones out, but we want to be careful to not totally leave out how other technologies are changing the dynamics of that labour market, the demand for their labour and that interest in their uptake.

[The Chair, Liberal, Bobby Morrissey]

Thank you.

Thank you, Ms. Koutrakis.

Mrs. Gill, you have the floor for six minutes.

[Marilène Gill, Bloc, Côte-Nord—Kawawachikamach—Nitassinan, QC]

Thank you, Mr. Chair.

I'd like to thank the witnesses for being with us today to shed light on the issue of youth unemployment, which concerns all committee members.

I would like you to elaborate on your opinion or to tell us more about your knowledge of artificial intelligence. It's come up a few times. Ms. Bednar just touched on it when she talked about the screening of résumés, and we talked about it last week, as well. More broadly, what would be the range of factors to monitor, in terms of youth employment? I know that it may go beyond the subject at hand, but I'd like to hear your comments on that, Ms. Tiessen.

Mr. Fortin, you can also add your comments.

[Pierre Fortin]

Right now, there is a boom of major investments in artificial intelligence by North American companies.

This AI boom is holding up the American economy. It has a lot of expansionary effect on the Canadian economy too.

There is a lot of worry throughout the youth labour market about the future. One of my children is a technological artist. He creates big monsters for video games. Of course, he's very worried about the future of his job, because maybe his employer will switch to AI instead of his own abilities.

What can we do about it? It's probably a good idea to try to encourage businesses and governments to help those young people who are worried about their future get the training that is necessary for them to get a hold on artificial intelligence.

That way, young people would have the opportunity to keep their jobs, but the content of their jobs will be changed. So training is fundamental.

[Marilène Gill, Bloc, Côte-Nord—Kawawachikamach—Nitassinan, QC]

In summary, AI is already driving job changes. Some jobs that young people would like to have may be in jeopardy right now. The teaching environments have to adapt quickly, as the workplace is already changing.

I would now like to hear what Ms. Tiessen and Ms. Bednar have to say about this.

[Kaylie Tiessen]

I think the jury is still out on whether AI is actually improving productivity in a particular business or in the economy more broadly. It's something that needs to be studied. We need to make sure we're not automating or erasing jobs that young people could be doing right now with technology that isn't doing the job as well as a person could do it, which means we get worse customer service and worse video games, as Professor Fortin was just talking about with his son. We need to be making sure that the technology we're relying on will create a higher-quality product. I don't think we know that yet.

What we could be working on instead, and what I'd love to see more technology companies focusing on, is how to marry workers with technology—that has happened over the last 100 years and many years before—to increase productivity over time in our labour market and in our economy. Marrying the two together, instead of just leaving thousands or hundreds of thousands or millions of workers unemployed.... It isn't going to create a high-functioning, thriving economy where people are feeling that they can create the lives they want, that they can use the skills, that they have the skills they desire to have and that they can actually participate in our economy more broadly. We need to be focusing a lot more on how to develop tools that workers use to create higher-quality output instead of just automating away systems that people are right now working in and providing those higher-quality opportunities.

I don't know if anyone has anything else to add.

[Marilène Gill, Bloc, Côte-Nord—Kawawachikamach—Nitassinan, QC]

Ms. Bednar, would you like to add anything? If not, I have other questions.

[Vasiliki Bednar]

Let's go to your other questions.

[Marilène Gill, Bloc, Côte-Nord—Kawawachikamach—Nitassinan, QC]

I probably won't have time to hear your answers to my next question, but you can start thinking about it and perhaps answer it in my next speaking turn.

We often talk about entry-level jobs. One thing we have never addressed in committee is the issue of offshoring. I don't know if that practice or concept is relevant to this discussion, but I would have liked to hear your comments on the subject. I won't have time to hear them right away, since my six minutes are already up. However, if you want to add comments during my next speaking turn, or send us your remarks in writing, that would be very useful.

Thank you very much.

[The Chair, Liberal, Bobby Morrissey]

Thank you, Mrs. Gill.

Ms. Falk, go ahead for five minutes.