Introduction to Youth Poverty

What do we mean by “youth”?

We use the United Nations definition of youth, which is anyone between the ages of 15-24.

What do we mean by poor?

If a family or individual spends 20 percentage points more of their total income on the essential items of food, clothing and shelter than the average family or individual, then they are poor. 43.1% of youth below the age of 24 were in low income (poor) after tax in 2001 compared to 14.2% of people aged 25-43

What groups of youth are poor?

• Youth who are the head or major income earner of families
• unemployed youth
• employed youth in minimum wage jobs
• youth receiving social assistance
• homeless youth
• students
• Aboriginal youth
• immigrant youth
• disabled youth
• youth in care or formerly in care

Why are they poor?

High unemployment rate for the 16-24 age category

• Youth have the highest unemployment rate of any group. In 2004, it was above 14% and still increasing for all provinces except Ontario and Quebec.

Jobs are paying less than they used to

• Wages and salaries earned in 2001 for youth under 20 were less than those earned in the 1980’s. Earning based on wages and salaries were $7281 in 1981, compared to only $6069 in 2001.
• Young adults between the ages of 20 and 24 on average earned only $14,697 in wages and salaries in 2001 compared to $20, 313 in 1981.

Fewer full time jobs

• The number of full time jobs with benefits and stable hours has decreased while the prevalence of part time jobs paying minimum wage with fewer hours has increased. Minimum wage means people must live below the poverty line. These jobs also make it more difficult to gain the hours needed to qualify for EI.

Increased restrictions and tighter eligibility rules for EI

• Although the unemployment rate for youth continues to climb, the number of youth receiving income assistance through EI continues to drop. Youth under age 20 who benefited from EI decreased from 67,000 in 1995 to 32,000 in 2001.
• The number of recipients aged 20-24 that receive EI benefits has declined from 449,000 in 1980 to 230,000 in 2001.
• The average income from EI has also decreased for those 20-24 from $4,850 (1980-91) to $3,462 in 2001.

Increased restrictions and tighter eligibility rules for social assistance

• Despite the fact that youth between the ages of 15-25 are the most impoverished in Canada, they represent only 15% of the social assistance caseload in Canada. Only 104,000 young adults between the ages of 20-24 received social assistance in 2001, compared to 191,000 in 1996. Among these youth the average amount received from social assistance declined from $7,344 in 1993 to $4620 in 2001 despite an increasing need.
• For youth under 20 only 20,000 received social assistance in 2001, compared to 59,000 in 1996. The average amount received from social assistance declined from $6065 in 1995 to $5206 in 2001.

Inadequate social assistance rates

• All social assistance benefits across the country fail to provide an income that reaches the poverty line.

Rising tuition fees for university students and increasing debt loads

Student debt faces ½ of all bachelor and college graduated students.

• In Ontario, following a tuition rate increase of 60%, four-year university graduates now acquire an average debt of $25,000 compared to an average debt load of $8700 in 1991.

Youth make up over half of the workers earning low wages

• Young people aged 15-24 represent the majority of low paid workers with 56.9% of youth earning less than $10 per hour. In most provinces and territories any wage below $10/hr places the earner below the poverty line.

What can be done about youth poverty?

• Raise the minimum wage across the country to at least $10 an hour and reinstitute the federal minimum wage.
• Ease restrictions on access to EI including number of hours required to qualify.
• End discriminatory social assistance policies and raise social assistance rates to at least the poverty line.
• Lower tuition fees and reinstitute a grants program to replace or augment the current student loan program.
• Develop a national job strategy that includes youth and creates full time, stable and adequately paid jobs.
• End the claw back of the National Child Benefit Supplement for young families receiving social assistance benefits.
• Implement and adequately fund programs that help immigrant, visible minority, Aboriginal and disabled youth access adequate employment.

National Anti-Poverty Organization, October 2004