Editor’s note: Starting with this op-ed, Research Money is launching “Youth Voices,” where our weekly Voices op-eds will regularly present the perspectives of young professionals and youth. Please send your op-ed submissions to Mark Lowey, managing editor, at: mark@researchmoneyinc.com

Alexander Zelenski is innovation analyst and researcher for the Institute for Collaborative Innovation Canada, based in Ottawa.

Budget 2025 offers a clear signal about Canada’s long-term priorities, and it also reveals a quiet but consequential gap. Only one percent of federal spending is directed toward Canadian youth, a group that today makes up 19 percent of Canada’s population.

At first glance, this may seem like a narrow budgetary detail; however, it reflects a much deeper problem with how Canada’s policy frameworks conceptualize youth, not as central economic actors but as future beneficiaries.

Despite ongoing conversations about intergenerational equity and youth being “the future,” Canada still lacks a dedicated youth economic strategy. Budgetary decisions are often not, if at all, evaluated through a generational lens, even as younger Canadians face rising affordability pressures, delayed entry into the labour market and rising emigration.

In our economy, which is strained by labour shortages, slowing productivity and geopolitical realignment, this disconnect is more than symbolic. It signals a fragmentation of how the country aligns its economic missions with its emerging workforce.

The implications are not social, they are structural, compounding, and are reaching a dangerous threshold.

Young Canadians face disproportionately tough job market outcomes. As of December 2025, youth unemployment stood at around 13.3 percent, nearly double the national rate (6.8 percent), according to Statistics Canada.

The challenge of job insecurity, coupled with high living costs and outdated academic and public services, is contributing to a generational “brain drain” of young talent.

In fact, a record 120,000 Canadians emigrated in the 12 months up to Q2 2025, the highest in record, and the majority of those leaving are young, educated professionals seeking better opportunities elsewhere.

This is not just a fairness problem. It’s a direct hit to Canada’s competitiveness. Youth are the implementation workforce behind the country’s most urgent missions: housing, health care, advanced manufacturing, and clean energy.

They also drive new business creation with roughly 60 percent of early-stage entrepreneurs in Canada under the age of 35. Yet even when talent stays, ambition often stalls, blocked by capital, risk aversion and limited access to procurement or scaling programs.

This isn't a pipeline problem; it's a policy design problem. Without targeted policy intervention, the country’s most mobile and future-ready workforce will continue to build futures elsewhere.

Canada’s peer countries are prioritizing youth

Peer countries provide us with an insightful contrast, often prioritizing youth education, skills-based training and innovation budgets.

The European Union has a well-designed Youth Guarantee Program, ensuring youth 30 and under get a job or training within months, backed by significant funding (EUR22 billion, 2021-2026) specifically to support youth employment initiatives.

Similarly, Nordic countries lead in youth investment: for instance, Norway’s Innovation Norway agency offers grants and mentoring for young entrepreneurs, and Germany’s longstanding apprenticeship system (combining training with education) is largely attributed to maintaining a low rate of youth unemployment (six to seven percent, less than half the EU average).

These examples demonstrate that investing early and generously in young people’s skills and ideas pays off in higher job creation and aligned incentives.

Canada doesn’t need to reinvent the wheel; it needs to adapt proven strategies to its own context. Aligning youth investment with national economic goals is not just smart policy, it's a prerequisite for establishing long term competitiveness.

The Canadian economy is drifting into a suspended animation, stalled by increasing costs of living, growing skills gaps and a lack of policy inertia. In this context, underinvesting in youth is not a missed opportunity, it’s a structural liability.

When young talent leaves or disengages, the effects cascade: fewer innovators, fewer startups, fewer taxpayer, and less capacity to act on national goals. But this isn’t a crisis of ambition.

Young Canadians want to contribute, not as passive recipients but as active builders of the future.

The question is whether our institutions are ready to match that ambition with the strategies and structures it deserves.

What can be done?

1. Redirect underutilized funds toward Youth Innovation Pilots.

Introduce a Youth Challenge Innovation Fund using surplus funds, unclaimed grants or procurement budgets. Invite youth to submit proposals tackling real and relevant federal missions.

2. Align youth and mission spending.

Design youth employment and engagement pathways aligned with federal missions so that youth get both exposure to some of the nation's most pressing challenges and, through this, become the informed and well-equipped workforce the country needs to not only meet its ambitious targets but also be competitive globally.

Mandate a Youth Workforce Inclusion Clause in all federal contracts, similar to community benefit agreements. This would be a more effective use of co-op terms and could help redesign the effectiveness of the academic system within Canada.

3. Enable higher level of collaboration for regional labs.

Deploy/support collaborative networks that regional innovation labs and academic institutions can use to identify shared problem spaces, solutions, and talent to advance their work. A repository of data that maps the landscape in a way that, through connecting stakeholders, the government can advance their work

4. Youth-driven policy audits.

Introduce a Youth Policy Audit Fellowship. Enable early career youth in federal departments (e.g. Natural Resources Canada; Innovation, Science and Economic Development Canada; Canadian Mortgage and Housing Corporation; etc.) to conduct audits of how existing policies impact Canadians under 30.

Budget 2025 unintentionally reveals a reality Canada has long sidestepped: youth are structurally undervalued in a system that increasingly relies on their labour, ideas and resilience.

But this moment is also an opportunity. Not just to reallocate funding, but for us to collaboratively redesign participation.

We need to engage youth not as recipients of policy, but as co-architects of Canada's competitiveness. We need to embed youth in the missions, structures and strategies that will define the next decade.

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