Commentary

Youth Unemployment Rate Is Only Really High With Teens Still Living at Home

image: iStock.

Youth unemployment is back in the news after new data suggesting we still have a high unemployment rate among the young. The government also just announced a whack of money to alleviate the pain of high youth unemployment.

While high unemployment rates are not a good thing it is important to always put statistics in context. That is hard to do in the modern world of infographics and the need to cut through the clutter with a killer stat.

If you look at the unemployment rate among youth in New Brunswick it is mostly concentrated in the 15- 19-year-old cohort of which 84 per cent are still in school.

We have to differentiate among the unemployed that are living at home with their parents and going to school and young people that are starting to build their careers and struggling to find work.

The 20-24 age group is more of a problem as only 42 per cent of them are in school but the unemployment rate among that group is down to 10.3 per cent – still too high. The real concern for me is the 9.6 per cent unemployment rate among the 25- 29-year-olds. By the time you get to the 30-34 group the workforce unemployment rate is down to 6.4 per cent – well below average.

We can use Census data to dive a lot deeper on this issue. When you look at the actual number of unemployed in the 15-19 age group around New Brunswick you find only 150 unemployed in the Moncton CMA, only 100 in the Saint John CMA and only 140 in Fredericton.

If you drive around each of those communities you will find help wanted signs in restaurants, retail stores, et cetera.  I’m just trying to put the 18.6 per cent unemployment rate in context.

RELATED: J.D. Irving, Limited Plans to Fill More Than 10,000 Jobs in the Next Three Years

Among those 25-29, when you look regionally the absolute numbers are also quite small. There are lots of potential reasons why the unemployment rate among that cohort is too high including a mismatch between skills, interests and the jobs on offer in local communities.

The EI system is likely boosting those numbers a bit.  A new immigrant I chatted with recently lost his job and was told “not to run out and get another job to hastily” and to “take your time and enjoy the time off with your family.”  He ignored that advice and got a job in a few weeks.

My fear, of course, is that the perceived (and actual) higher unemployment among young people in New Brunswick will keep us from focusing on addressing real labour shortages around the province.

If you look at the unemployment rate by major occupational group you will see that unemployment among most occupational groups in the province is quite low and comparable to the national average.

It’s only when you get into the trades, trucking, natural resources and manufacturing occupations where you start to see a substantially higher unemployment rate.

Again the influence of seasonality is probably driving up the rate in these sectors. Yes, I admit that conceptually it is hard to justify high unemployment rates and labour shortages at the same time but that is a New Brunswick reality.  Person X works in a seasonal manufacturing or natural resources job while company Y can’t find year-round workers in manufacturing or natural resource jobs.

David Campbell writes a blog about economic development in Atlantic Canada called It’s The Economy, Stupid. This post was republished with permission. Campbell also operates Jupia Consultants, a consulting company that conducts demographic and economic analysis.

Huddle publishes commentaries from groups and individuals on important business issues facing the Maritimes. These commentaries do not necessarily reflect the opinion of Huddle.