This month in Canada and elsewhere in the world, millions of university and high school students graduated, most in virtual ceremonies, and entered a labour market deeply affected by COVID-19. Our previous research, as well as many others have highlighted the disproportionate impacts on young workers : over 15.4% of jobs lost in March was attributed to workers aged 15 to 24, and there is evidence that employers are rescinding potential employment offers. Add to this the broad spectrum of youth that exists, for example those with young children, complicating the picture of the youth employment landscape further.
In much of our previous research, we have often focused on mid-career workers, but employment trends observed in this pandemic show that disruption to early career workers has been the most severe, prompting us to focus further on this crucial group of workers. We find that:
- There were large movements from employment to both unemployment and out of the labour force observed for both youth and the general population.
- However, youth were twice as likely as the general population to transition into unemployment or outside the labour force (11% for youth, 5.6% for the general population).
- Up to 1 in 3 young unemployed workers in February left the labour force in March, a higher rate than that for the general population (up to 1 in 4).
- Compared to one year ago, fewer youths who were not in the labour force moved into the labour force (either directly starting work, or actively looking for work).
To arrive at these insights, we used a popular tool in labour economics in understanding labour dynamics in an economy: labour market transition probabilities. Broadly speaking, an individual can belong to one of three groups at any one moment: employed (working for pay), unemployed (not working for pay but actively want to work and seek employment), or outside of the labour force (not working and is not actively looking for work) – understanding these transitions allows us to go further than aggregate employment statistics, and glimpse the robustness of the labour market. This is also an important lens to consider for youth, as many might be entering the labour force for the first time in their life or transitioning from full time school.