Unemployment Rate (Youth)
The youth unemployment rate measures youth (ages 15-24) involvement in the labour force.
Why This Matters
The youth unemployment rate is an indicator of youth involvement in the economy, and it has been shown that early work experience has a major impact on people’s long-term career prospects. Youth unemployment can have long-term effects on an economy like lower levels of human capital, reduced wage rates and weakened future labour force participation (Mroz and Savage, 2006; Gregg, 2001; Gregg and Tominey, 2005; Arulampalam, 2001). The failure to find a first job or retain employment can have long-term consequences on career prospects commonly referred to as “scarring” (Ellwood, 1982; Heckman and Borjas, 1980; Corcoran, 1982) which adversely affects happiness, job satisfaction and health, later in life (Scarpetta et al. 2010). Youth unemployment is also correlated with crime (Fougere et al. 2009; Bell and Blanchflower, 2011).
Measurement and Limitations
From May to August, the Labour Force Survey collects labour market data about young people aged 15 to 24 who were attending school full time in March and who intend to return to school full time in the fall. The May survey results provide the first indicators of the summer job market, especially for students aged 20 to 24, as most students aged 15 to 19 are not yet out of school for the summer. The data for June, July and August will provide further insight into the summer job market. The published data are not seasonally adjusted, and therefore comparisons can only be made from one year to another.
Data is updated on Peg as it becomes available from the data providers.
Labour Force Survey Youth Unemployment CMA Statistics Canada 282-0109 (seasonally unadjusted). Retrieved from http://www5.statcan.gc.ca/cansim/a26?lang=eng&id=2820109
Fougere, D., Kramarz, F., & Pouget, J. (2009). Youth unemployment and crime in France. Journal of the European Economic Association, 7(5), 909-938.
Mroz, T. A., & Savage, T. H. (2006). The long-term effects of youth unemployment. Journal of Human Resources, 41(2), 259-293.
Ellwood, D. T. (1982). Teenage unemployment: Permanent scars or temporary blemishes?. In The youth labor market problem: Its nature, causes, and consequences (pp. 349-390). University of Chicago Press. Retrieved from http://www.nber.org/chapters/c7878.pdf
Scarpetta, S., A. Sonnet and T. Manfredi (2010), “Rising Youth Unemployment During The Crisis: How to Prevent Negative Long-term Consequences on a Generation?”, OECD Social, Employment and Migration Working Papers, No. 106, OECD Publishing. doi: 10.1787/5kmh79zb2mmv-en. Retrieved from: http://zunia.org/sites/default/files/media/node-files/yo/193707_youthunemploymnt1282469690.pdf
Gregg, P. (2001), “The Impact of Youth Unemployment on Adult Unemployment in NCDS”, Economic Journal, 111(475), pp. 623-653.
Gregg, P. and E. Tominey (2005), “CThe Wage Scar From Male Youth Unemployment”, Labour Economics, 12(4), pp. 487-509.
Arulampalam, W. (2001), “Is Unemployment Really Scarring? Effects of Unemployment on Wages”, Economic Journal, Vol. 111, pp. 585-606.
Bell, D., & Blanchflower, D. (2011). Youth unemployment in Europe and the United States. http://www.econstor.eu/bitstream/10419/52025/1/666568499.pdf
Heckman, J. J., & Borjas, G. J. (1980). Does unemployment cause future unemployment? Definitions, questions and answers from a continuous time model of heterogeneity and state dependence. Economica, 47(187), 247-283.
Corcoran, M. (1982). The employment and wage consequences of teenage women’s nonemployment, in Freeman, R. B. and D. A. Wise, (editors), The Youth Labor Market Problem: Its Nature, Causes, and Consequences, University of Chicago Press and NBER.
Unemployment Rate (Youth) in the Sustainable Development Goals
Click on the SDG to reveal more information
8. Promote inclusive and sustainable economic growth, employment and decent work for all
Roughly half the world’s population still lives on the equivalent of about US$2 a day. And in too many places, having a job doesn’t guarantee the ability to escape from poverty. This slow and uneven progress requires us to rethink and retool our economic and social policies aimed at eradicating poverty.
A continued lack of decent work opportunities, insufficient investments and under-consumption lead to an erosion of the basic social contract underlying democratic societies: that all must share in progress. The creation of quality jobs will remain a major challenge for almost all economies well beyond 2015.
Sustainable economic growth will require societies to create the conditions that allow people to have quality jobs that stimulate the economy while not harming the environment. Job opportunities and decent working conditions are also required for the whole working age population.
Related Unemployment Rate (Youth) Targets
By 2020, substantially reduce the proportion of youth not in employment, education or training