Weeks after Mark Carney's win, Canada's economy appears in crisis; job data at its lowest almost in years

Newly elected Prime Minister Mark Carney is confronting a significant economic downturn as Canada's labor market shows alarming signs of deterioration, particularly impacting recent graduates. Fresh data reveals a concerning trend of rapidly rising unemployment and sluggish job creation, exacerbating existing economic vulnerabilities just months into Carney's tenure. In April 2025, Canada added a meager 7,400 jobs, a figure far below expectations and insufficient to keep pace with population growth, consequently pushing the national unemployment rate to 6.9%. However, the situation is considerably more severe for young Canadians entering the workforce. The unemployment rate for recent post-secondary graduates has surged to a troubling 11.2%, marking the highest rate at the beginning of a year in at least two decades, according to an analysis of Statistics Canada data by Brendon Bernard, a senior economist at Indeed Canada. This paints a stark and bleak picture for young Canadians attempting to launch their careers, gain financial independence, and secure their long-term financial futures. Indeed, sources like The Globe and Mail are reporting that the current labor market conditions represent the bleakest in decades for this demographic.The delayed economic recovery, significantly hampered by external factors such as the ongoing trade disputes with the United States – involving substantial tariffs on key Canadian exports like steel, aluminum, and automobiles – has dashed earlier hopes for a swift rebound in the labor market following anticipated interest rate adjustments by the Bank of Canada. Economists are increasingly concerned that graduating during such a pronounced economic downturn could have enduring negative consequences on young individuals' career trajectories, potentially leading to prolonged periods of underemployment, slower income growth, and hindered career advancement. “If the recovery is swift, people can regain momentum,” Bernard cautioned, “But right now, it's unclear how long these conditions will persist, and the longer it takes, the greater the potential for lasting damage to their career prospects.”The financial ramifications of this employment crisis for young Canadians are substantial and long-lasting. Protracted delays in securing stable and meaningful employment directly impede their ability to initiate savings and investment early in their careers – a cornerstone of long-term financial security. Certified financial planner Desmond Nwaerondu of Sun Life in Calgary emphasizes the critical impact of delayed savings on retirement goals. He illustrates this with a compelling example: an individual who begins saving $200 per month at age 20 with a hypothetical 4% annual return would accumulate approximately $296,842 by age 65. In contrast, someone who delays saving until age 30, with the same monthly contribution and return, would amass only $180,642 – a difference of over $116,000 due to just a decade of delayed action. This highlights the power of compounding and the significant disadvantage faced by young individuals who are unable to start saving early due to unemployment or underemployment.Despite the challenging economic landscape, experts offer guidance for young job seekers striving to navigate this difficult market. Chris Raper, a portfolio manager at Aspira Wealth (Raymond James Ltd.), advises adopting a pragmatic approach by gaining any form of work experience available, even if it falls outside their immediate field of interest. He argues that these roles, such as camp counseling or positions in the hospitality industry, can be invaluable in developing essential soft skills that are highly valued by employers across various sectors. Furthermore, Raper underscores the growing importance of acquiring high-demand technical skills, particularly in areas like Artificial Intelligence (AI), suggesting the utilization of readily available free online resources such as YouTube for self-directed learning. Networking is also identified as a critical strategy, with professionals recommending active engagement on platforms like LinkedIn and attendance at relevant industry events to build connections and uncover potential opportunities. “You need to get in front of the people working in the industry you want to join,” Raper advises.The broader economic outlook for Canada under Prime Minister Carney's leadership appears increasingly precarious. The combination of high unemployment, particularly among young people, and sluggish overall job growth raises serious concerns about potential economic stagnation. The ongoing trade tensions with the US, manifested in tariffs on key Canadian exports, further exacerbate these challenges by negatively impacting crucial sectors of the Canadian economy. Statistics Canada data indicating that approximately 1.6 million Canadians are currently unemployed underscores the significant strain on the national labor market. The net addition of only 7,400 jobs in April, following a loss of 32,600 jobs in March, highlights the volatile and uneven nature of the current economic recovery, further amplifying anxieties about Canada's economic stability in the face of persistent trade headwinds and a weakening labor market.