Finance Minister Chrystia’s Freeland’s latest budget was written for the kids. It referred to Gen Z and millennials 21 times, while boomers received only four mentions and generation X was snubbed. 

The highlight was a promise to build four million homes, a gift to the youngsters who have been blocked from joining the ownership class by impossible prices, higher interest rates, strict lending rules—on top of a severe lack of supply. Freeland committed an additional $8.5 billion to the project, suffering a barrage of insults from the business community because she raised taxes to pay for it all. 

“Here in Canada, things actually are harder than they were for previous generations,” Freeland said recently on an episode of “Money Talks,” a podcast produced by The Economist magazine. “I’m going to be 56 this summer. I am a mother of three, and I really do think a central obligation of the parent and grandparent generations is to make a good life achievable for millennials and Gen Zs.”    

Youngsters don’t seem to care. Support for the government has cratered, but the most pronounced shift is among younger voters—only 22 per cent of voters aged 18 to 35 would vote Liberal today, compared with 41 per cent in 2015 and 34 per cent in early 2021, according to Abacus Data, a polling firm. 

Things are undeniably harder if you equate the good life with owning a home. Prices have more than quadrupled since 2000, creating a perverse situation in some cities where the amount of money needed to qualify for a mortgage exceeds the median income. The decision to allow immigration at rates that vastly exceeded the historic rate of housing starts caused rents to soar higher than they already had, although Carl Gomez, an economist at real estate data firm CoStar, predicts rental costs are on the verge of coming back down.

But home ownership is only one path to wealth and stability. Freeland’s interlocutor on the podcast might have noted the essay The Economist published in April under the title “Generation Z is unprecedentedly rich.” It’s not obvious that Canada’s youth have it worse than their global peers, or the generations that preceded them. In many ways, they have it much better. 

On average, younger workers get paid more while working fewer hours. In 2001, youth aged 15 to 24 worked at average 28.7 hours per week at an average hourly wage of $9.94. A basket of goods that cost $100 back then would cost $163.53 today, according to the Bank of Canada’s inflation calculator. 

Wages have more than kept up—the average hourly wage for workers aged 14 to 24 in June was $21.25, an increase of almost 114 per cent from the 2001 average. Younger workers were on the clock for an average of 20 hours per week last year, and about 21 hours per week so far this year, according to Statistics Canada. A generation that craves work-life balance has achieved it. 

Yet the perception that Gen Z and millennials are in trouble is driving politics and policy, perhaps because those cohorts now represent the country’s largest vote block. That motivates politicians to respond to what pollsters tell them younger people are feeling. 

“The economic struggles faced by young Canadians have changed both their daily lives and their voting preferences,” Abacus Data pollsters Eddie Shepherd and David Coletto advised.

How unique are those struggles, really? The affordability squeeze of the past few years has been difficult for anyone touched by meagre fortune, no matter their age. Abacus reported that a significant number of younger respondents say higher costs have forced them to delay purchasing a home. In a country as indebted as Canada, it’s positive that households are beginning to deleverage. 

Statistics Canada reported last month that the average mortgage debt of households younger than 35 has been declining since the end of 2022, the only age group in which that has happened. The agency said those households might be selling their homes because they can’t afford higher interest payments, or they “may be receiving financial support from family,” suggesting the windfall that boomers accumulated during the housing boom is now being shared with younger generations.  

“You want to know the people who are the most hopeful in this country? The Gen Zs,” said John Wright, executive vice-president at Maru Public Opinion in Toronto and the father of two of them. 

Wright’s polling somewhat contradicts the narrative that Canada’s youth are desperate for help from their government. The monthly Maru Household Outlook Index has tracked the broader public’s descent into misery towards the end of 2021, when the high that came with the release from COVID-19 lockdowns was replaced by anger over surging inflation. Yet Wright has found that respondents aged 18 to 27 appear relatively optimistic, so much so that in July they were responsible for an uptick in the index, as a third of Gen Z said their financial position improved over the previous month. 

“They love the way this world is evolving, where they can work anywhere,” Wright said. “They don’t have to have as much money. They actually are being supported by a lot of their parents to stay at home and earn their money, but they don’t need the things that we were aspiring to at this time.” 

What they will need is a good education. There’s a tight correlation between employment and time spent in school, which ought to prompt a larger discussion over the decision of governments to spend billions on housing and industrial subsidies instead of shoring up a fragile system of post-secondary education.  

Future generations will pay the price for that failure. Today’s youngsters have their degrees and certifications: almost 40 per cent of women aged 25 to 34 have a bachelor degree or higher, compared with about 30 per cent in 2006, according to the most recent census; for boys, it’s 26 per cent versus 21 per cent.  

The youth have never been better educated, and they’ll get to start their adult lives free of any delusions that life is easy. Policymakers should focus on doing what they can to make sure the economy works for everyone. The young will find their way. 

Kevin Carmichael is The Logic’s economics columnist and editor-at-large. He has spent more than two decades covering economics, business and finance for outlets including Bloomberg News, The Globe and Mail and the Financial Post, where he also served as editor-in-chief.