Eligible Bachelors: Canada’s newest university graduates face an increasingly challenging job market
Authors
Pete Nelson, Senior Economist at Labour Market Information Council
Boxi Yang, Senior Research Associate at The Conference Board of Canada
Introduction
For years, earning a bachelor’s degree was seen as the surest route to stable employment for young Canadians. But as the class of 2025 enters the labour market, they are discovering that the ground beneath their feet has shifted. The pathways from university to white-collar work are narrowing. Vacancies are drying up. For the first time in decades, having a degree is no longer a reliable hedge against unemployment.
This is not merely anecdotal. Our analysis of recent Statistics Canada data¹ shows a sharp deterioration in labour market conditions for young university graduates. Entry-level jobs that once welcomed bachelor’s degree holders appear to be vanishing, and the relative advantage that such degrees once conferred is eroding. The trends suggest not a temporary cooling, but a structural realignment of early-career work—one driven by automation, shifting employer preferences, and an uncertain global economic climate.
A mismatch in motion
Start with the big picture. Over the past three years, the number of young Canadians with a bachelor’s degree has climbed steadily. Among those aged 15–24, the population of degree holders has never been higher. Yet as this cohort has grown, the opportunities available to them have decreased. Vacancies for jobs requiring a bachelor’s degree and fewer than three years’ experience have dropped by more than half since early 2024.
The decline is not modest. From a peak of more than 70,000 vacancies nationally, the number of vacancies had fallen by more than half to fewer than 30,000 by early 2025. Meanwhile, the graduate population continues its upward march, undeterred. The result is a growing gap that threatens to delay or derail the early careers of thousands of young people.
This shift has implications not just for individuals, but for educational institutions. Post-secondary systems that once pointed confidently toward knowledge-based jobs must now contend with a more fragmented and less forgiving labour market. The assumption that education equals opportunity is being tested.
No vacancy
Zoom in and the pattern becomes more pronounced. Entry-level roles are not only declining in aggregate, but collapsing in some of the most degree-intensive fields. Vacancies in business, policy, software, and data science—once reliable entry points for recent grads—have withered.
Early-career postings for business, marketing, and human resources jobs fell by nearly 40% in the first quarter of 2025. Policy, research, and legal roles were down by about one third. Even software engineering and data science—growth engines of the digital economy in recent years—are dialling back junior hiring.
Why the pullback? One possible explanation is the rise of AI in the workplace. As generative models and machine-learning systems proliferate, employers are finding that many of the tasks traditionally handed to entry-level staff—such as drafting, summarizing, coding, and analyzing—can now be performed, at least partially, by algorithms. The work hasn’t vanished. But its shape has changed.
Employers may no longer see value in bringing on inexperienced workers when a more seasoned hire—or a subscription to an AI tool—can do the job faster. The entry point, once defined by learning and mentorship, is increasingly defined by automation and consolidation.
A similar story is unfolding in the U.S. A recent report by the Burning Glass Institute—No Country for Young Grads (Levanon et al., 2025)—documents how employers are ratcheting up experience requirements in job postings, especially in sectors vulnerable to AI. The study finds that automation is eroding entry-level work, shifting employer demand away from recent graduates and toward seasoned professionals who can supervise or complement intelligent systems. Junior roles are being hollowed out.
The value of a degree, reappraised
Perhaps the most telling signs that the ground is shifting come from unemployment data. For decades, youth with bachelor’s degrees consistently enjoyed lower unemployment rates than peers’ holding non-bachelor’s postsecondary credentials. The “degree premium” was not only academic; it was statistical.
That pattern has now flipped.
Statistics Canada data show that since 2023, the unemployment rate among bachelor’s degree holders aged 15–24 has edged above that of youth with post-secondary certificates or diplomas. Degree holders are now more likely to be unemployed than those with college or trades credentials.
This pattern points to a broader shift in labour demand. Many certificate or diploma holders are entering occupations that are more insulated from automation and economic volatility—such as those in the skilled trades and healthcare. These sectors are proving resilient, offering hands-on work that is difficult to outsource or mechanize. While AI reshapes white-collar work, demand for workers in healthcare and the skilled trades—from nurses to electricians, plumbers, and HVAC technicians—has remained relatively stable.
It is a rare inversion: the credential long associated with better labour market outcomes is now associated with greater risk, at least at the start of a career. The degree premium may still apply in the long run—but in the short term, young graduates are encountering bottlenecks while their college-trained peers find more open doors.
A new entryway—or no entry at all?
This poses a dilemma. If young Canadians can no longer count on degree-based jobs to absorb them, where do they go? Some may take roles for which they are overqualified. Others may delay their job search altogether. Still others may pivot to graduate studies or retraining—not necessarily out of ambition, but out of necessity.
For policy-makers and educators, the takeaway is clear: the school-to-work transition has become more complex and less predictable than it was in the past. It requires closer alignment with evolving labour market needs, and above all, visibility. Timely labour market information—at the occupational level—is essential if students are to make informed decisions before, during, and after their education.
Degrees still confer long-term benefits. But they no longer guarantee a smooth entry into the workforce. If Canada is to make good on its investments in education, it must ensure that the early rungs of the employment ladder are not kicked away by coding and caution.
The age of AI is here. The age of easy grad jobs may be over
Canada is not alone in facing this challenge. But its demographic and economic context makes the problem particularly urgent. The young graduate cohort is growing. The early-career economy is not. Unless these trends are reconciled, a generation of talent risks becoming stuck at the starting line.
Yet this very uncertainty creates an opportunity. As technology reshapes work and the supply of graduates continues to expand, it is more important than ever that those involved in education, training, hiring, and policy have access to timely labour market information. Clear, timely insights can help students, institutions, and employers alike make better choices—ensuring that Canada’s next generation of talent is not left waiting on the sidelines, but guided toward the opportunities where they can thrive.
Watch the recap of LMIC’s free webinar, Youth Employment in 2025: Trends Reshaping the Next Gen Workforce in Canada, where we share the latest trends in youth employment—why bachelor’s degrees are losing ground, how polytechnic pathways are rising, and what the widening early-career divide means for Canada’s next generation. Discover how labour market information can support better decisions for students, institutions, and employers.
Acknowledgements
We’re pleased to have worked alongside The Conference Board of Canada in developing this piece and thank them for their valuable contributions.
End Notes
¹ Tables 14-10-0019-01, 14-10-0020-01, and 14-10-0443-01.
References
Canadian Apprenticeship Forum. (2024). Apprentice demand in Red Seal trades: A 2024 national labour market information report. https://caf-fca.org/research_reports/executive-summary-apprentice-demand-in-red-seal-trades-a-2024-national-labour-market-information-report/
Levanon, G., Sigelman, M., Mamertino, M., de Zeeuw, M., & Guilford, G. (2025). No country for young grads: The declining value of a college degree in the U.S. The Burning Glass Institute. https://www.burningglassinstitute.org/research/no-country-for-young-grads#:~:text=For%20the%20first%20time%20in,forces%20reshape%20entry%E2%80%91level%20work.
Mehdi, T., & Morissette, R. (2024). Experimental estimates of potential artificial intelligence occupational exposure in Canada. Statistics Canada. https://www150.statcan.gc.ca/n1/pub/11f0019m/11f0019m2024005-eng.htm
Smith, M. (2024). Insights on generative AI and the future of work. North Carolina Department of Commerce (Labor & Economic Analysis). https://www.commerce.nc.gov/news/the-lead-feed/generative-ai-and-future-work
Statistics Canada. (2025). Job vacancies, second quarter 2025. https://www150.statcan.gc.ca/n1/daily-quotidien/250916/dq250916b-eng.htm
Statistics Canada. (2025). Table 14-10-0019-01 (Labour force characteristics by educational attainment, monthly, unadjusted for seasonality). https://www150.statcan.gc.ca/t1/tbl1/en/tv.action?pid=1410001901
Statistics Canada. (2025). Table 14-10-0020-01 (Unemployment rate, participation rate and employment rate by educational attainment, annual). https://www150.statcan.gc.ca/t1/tbl1/en/tv.action?pid=1410002001
Statistics Canada. (2025). Table 14-10-0443-01 (Job vacancies, proportion of job vacancies and average offered hourly wage by occupation and selected characteristics, quarterly, unadjusted for seasonality). https://www150.statcan.gc.ca/t1/tbl1/en/tv.action?pid=1410044301