Government intervention needed to address youth unemployment

The Canadian Federation of Students, and most of the people we have spoken to, is at a loss over how the government thinks it can increase student and youth employment without direct state intervention in the economy via wage subsidies and/or direct student employment programs.

According to the OECD, if just left to the market, any increases in the minimum wage will result in an increase in the unemployment of youth and students. They suggest that without government support for youth/student/apprenticeship programs, youth unemployment will remain high and lead to a large range of long-term social ills.

The Federation supports the Federal Student Work Experience Program and similar programs that subsidize wages for students who work in the summer. The problem is that this program has not seen the increases necessary to keep up with enrolment, never mind the increase in student-need and demand by small businesses and non-profits.

That being said, students feel that the best way to address high youth and student unemployment is to address unemployment. Given the recession, traditional student and youth job markets (i.e. entry-level positions and temporary employment) have been eaten up by a reserve army of skilled workers who are now out of work. We have also seen public sector hiring freezes and reductions (both provincial and national) of the past twenty years contribute to high levels of unemployment for youth and students.

I think that most economists agree that the only way to address youth unemployment (either through wage subsidies or through direct hiring) is through state intervention. The question is whether the current government is going to start listening to them.

Finally, student unemployment and high tuition fees are unquestionably driving up student debt. This is one of the reasons that the government has reached its $15 billion debt ceiling on student debt 5 or so years before it expected to. It is also contributing to what we think is a large climb in education-related private debt loads. That is to say, that the private debt to income ratio is only going to get worsen.

It is a bleak picture for students and youth in this country and, as the privatization/marketization of education continues unabated, it will only get worse.

For more information, read the Canadian Federation of Students’ fact sheet on Student Employment: http://www.cfs-fcee.ca/html/english/research/factsheets/Factsheet-2010-StudentEmployment-En.pdf  

Graham Cox is with the Canadian Federation of Students. 

 

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