They did everything right. They got the degrees, took the entry-level jobs, moved back home to save, and still, many young Canadians can’t get ahead. For a generation raised with the promise that hard work leads to stability, that promise is slipping further out of reach.
Nearly half of Canadians aged 18 to 34 now say they feel constant stress or anxiety over money, according to a recent Global News report. One in three are living paycheque to paycheque. Many are putting off milestones their parents once took for granted: buying a home, starting a family, even moving out on their own.
Youth unemployment remains a significant challenge. As of June 2025, the national youth unemployment rate sits at 14.2%, a jump from 10.8% before the pandemic. Student job seekers face an even steeper hill — with a jobless rate of 17.4% this past June.
Regional disparities exist, with Ontario reporting a youth unemployment rate of 15.8%. MNP president Grant Bazian warns that even those making smart, cautious choices are struggling to gain ground: “Those making careful choices and delaying major decisions may be struggling to get ahead amid the current uncertainty around costs and income,” he told Global.
Young renters squeezed hardest by housing costs
The housing affordability crisis hits young renters hardest. According to Statistics Canada, 63% of Canadians between 15 and 29 years of age rent their homes — almost double the national average of 33%. And it’s costing them. Nationally, youth renters aged 15–24 spend about 23% of their income on shelter. But in Toronto that figure jumps to 31%, above the 30% “affordable housing” threshold.
Nationwide, nearly half of young adults (59%) are “very concerned” about affording housing. Many are adjusting budgets, cutting on groceries (68%), skipping savings (57%) or even delaying debt repayment (51%) just to keep the lights on.
For comparison, about one-third of Canadians overall report being very concerned about housing affordability.
Debt, inflation and slow hiring are stacking the odds against youth
Beyond housing, Canada’s broader economy is weighing young people down. A trade conflict with the U.S. and persistent inflation have led to less hiring, economist Armine Yalnizyan told Global News, calling this a “pure alarm bell” for youth unemployment.
Young households are also facing soaring debt servicing costs. For households where the primary earner is under 35, interest costs rose to 9.7% of disposable income in 2023, up from 6.6% in 2020. This increase is largely due to higher mortgage interest rates, compounding financial strain for younger Canadians.
Canada’s overall household debt reached over 180% of disposable income, the highest in the G7. Student loans, credit cards and mortgages combine to limit financial flexibility.
Daily living expenses only add to the pressure. "All of the expenses of just daily living, and how much parking in the city might be, or how much just going to the grocery store is, and things just start to add up," 28-year-old Emma Burke-Kleinman told Global News.
From rebates to rentals: how government plans aim to ease the pressure
Officials are listening. The 2024 federal budget — branded a “Gen Z budget”—focused on targeted support for millennials and Gen Z, including funding for housing, child care and student aid.
Now in 2025, under Prime Minister Mark Carney, the Liberal government is building on that foundation. Carney’s administration has dedicated $8.5 billion to accelerate homebuilding and is advancing legislation like Bill C‑56, which removes the GST on new rental construction to spur supply. This spring’s housing plan also aims to slash municipal development charges, boost student housing and ramp up to 500,000 new homes annually.
Since August 2024, first-time buyer access has improved: 30-year mortgages on new homes and up to a $60,000 withdrawal from retirement savings are now allowed — measures aimed at easing young Canadians into homeownership.
The government has also expanded youth employment programs. The Canada Summer Jobs initiative continues to create thousands of summer positions, and funding for the Youth Employment and Skills Strategy (YESS) supports training in technology, green energy and skilled trades.
But structural challenges persist. Housing starts in Canada were largely flat through May, with a seasonally adjusted annual pace of around 279,500 units, just 0.2% below April’s level. In June, starts eked out a modest 0.4% gain to approximately 283,700 units.
Despite this slight recovery, CMHC’s long-term outlook remains sobering: They estimate only 245,000 starts per year under current conditions — well short of the 430,000–480,000 per year needed to restore pre-2019 affordability by 2035.
Without deeper policy shifts and accelerated private sector backing, Canada is unlikely to build its way out of the affordability squeeze anytime soon.
Your action plan for surviving Canada’s affordability crunch
1. Stabilize your housing costs: If you’re renting, assess your shelter-to-income ratio. Ideally aim to spend less than 30% of your income on rent. If it’s higher, explore shared housing, rent-controlled units or move to a lower-cost region, even temporarily.
2. Boost job readiness and diversify income: With youth unemployment elevated, scouting for seasonal or gig roles, especially in sectors like construction and trades, can be critical. Those skills can also boost future earnings and homebuying prospects.
3. Leverage government support: Take advantage of new programs: the First‑Home Savings Account, low‑GST on new rentals, childcare subsidies and student aid. These can free up cash flow and help avoid debt traps.
4. Plan ahead and build buffers: Despite the pressure, one-third of Canadians are still saving more this year, according to MNP. Focus on building emergency savings first — even small monthly amounts add up — and avoid dipping into credit for essentials.
The road ahead is tough — but possible to navigate
Young Canadians face a perfect storm: high rents, stubborn unemployment, inflation and debt. But with federal focus on housing and youth-centred policies, there is hope to regain footing. For now, the key is proactive planning: tighten your budget, explore government programs and secure income streams that work for you.
At the same time, experts emphasize Canada’s housing crisis won’t resolve overnight. Meaningful relief requires sustained housing supply growth and economic stability. But by understanding your options and acting early, young Canadians can navigate this challenging landscape and move toward financial resilience.
Sources
1. Global News: ‘Youth-cession’ sees young Canadians struggling most, poll data shows (July 15, 2025)
2. Statistics Canada: ‘Navigating Socioeconomic Obstacles: Impact on the Well-being of Canadian Youth (September 20, 2023)
This article provides information only and should not be construed as advice. It is provided without warranty of any kind.