What is happening in the youth labour market in Canada?

This paper analyzes the evolution of the labour market participation rate o f men and women age 15 to 24 from 1976 to 1998. The main question being ask ed is why youth participation rates fell precipitously during the 1990s? We look at two dimensions of this decline: changes in the fraction of youth w ho participate in the labour market but do not attend school (non-student p articipation rate) and changes in the employment rate among students. We fi nd that the decline in the non-student participation rate is a consequence of two factors: (i) the overall bad state of the labour market in Canada du ring the 1990s rind (ii) the large increase in school enrolment rates induc ed by factors other than the state of the labour market. One important find ing is that demographic change (baby boom versus baby bust) is a key explan ation behind the steep increase in enrolment rates during the 1980s and 199 0s. The only component of youth outcomes in the 1990s which we are unable t o reasonably explain is the fall in the employment rate of students age 15 to 19.