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What Is Happening in the Youth Labour Market in Canada?

This paper analyzes the evolution of the labour market participation rate of men and women age 15 to 24 from 1976 to 1998. The0501n question being asked is why youth participation rates fell precipitously during the 1990s? We look at two dimensions of this decline: changes in the participation rate of youth who are not attending school (non-student participation rate) and changes in the employment rate of students. We find that the decline in the non-student participation rate is a consequence of two factors: (1) the overall bad state of the labour market in Canada during the 1990s, and (2) the large increase in school enrollment rates induced by factors other than the state of the labour market. One important finding is that demographic changes (baby boom vs baby bust) is a key explanation behind the steep increase in enrollment rates during the 1980s and 1990s. The only component of youth participation rates which seems to be a problem specific to the 1990s is the sharp drop in employment rates of students age 15 to 19.
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