Canada is at a breaking point—the growing generational gap is a big reason why

The following is an excerpt from Breaking Point: The new big shifts putting Canada at risk (Signal, 2025). It has been edited and condensed for clarity. Be sure to watch your podcast platforms for our in-depth interview with Bricker and Ibbitson this coming Monday. Many young Canadians are giving up on their future. They might one day be prepared to give up on Canada itself. This is not hyperbole; this is data. An October 2023 poll by Nanos Research revealed that 70 percent of Canadians—including 75 percent of adults under thirty-five—believe the next generation will experience a lower standard of living compared to today. Young Canadians are poorer, more indebted, and more economically precarious than any generation in modern history. The social contract that promised each generation at least as good a life as the previous one is broken. Central to the pessimism by and toward the young is homeownership, or the lack of it. Owning a home, a cornerstone of middle-class aspiration since the end of the Second World War, was once within reach for the average Canadian family. For decades, hard work and financial discipline were usually enough to secure a place of one’s own. Not anymore. In 1976, the average price of a home in Canada was about $57,000, roughly three and a half times the median household income. Today, the benchmark home price has soared past $750,000, more than eight times the median income. In cities like Toronto and Vancouver, the gap is even more extreme, with price-to-income ratios exceeding 10 to one. In major cities, today, the average mortgage payment swallows more than 60 percent of a household’s income, according to a December 2023 report by RBC Economics. The mortgage payment as a percentage of income (MPPI) for non-condo properties in the Greater Toronto Area is now 81 percent. That’s right, Torontonians are now shelling out eight dollars of every 10 they earn in pre-tax household income just to cover the mortgage for the average middle-class house in Canada’s most populous city. Young Canadians have responded by giving up on homeownership. According to a June 2024 Ipsos poll, three-quarters of Canadian adults under 35 believe that owning a home is now a privilege reserved for the rich. The home-buying numbers bear this out. According to the Bank of Canada, in 1981, 55 percent of Canadians aged 25 to 34 owned a home. By 2024, that figure had plummeted to just 36 percent, a stark reflection of how affordability has collapsed for many younger Canadians. Young renters aren’t catching a break either. In 2023, the average rent for a one-bedroom apartment in Toronto soared to $2,500 per month, marking a staggering 20 percent increase in just one year, says rentals.ca. Although rents have come down a bit recently, the increasing cost of other essentials has clawed back any savings. Grocery costs surged by more than 11 percent in 2022, the largest annual increase in four decades, and there is no sign of prices coming back down. And all this was before Donald Trump’s tariffs kicked in. The housing crisis is not the result of a failure of capitalism but of a failure to allow capitalism to function. Restrictive zoning laws, slow bureaucratic approvals, and excessive red tape have strangled housing supply, making it nearly impossible for developers to meet demand. In places like Texas, where fewer building restrictions exist, housing remains far more affordable despite strong population growth. Canada’s political class has prioritized protecting existing homeowners over enabling new construction, leaving young Canadians with few options other than lifelong renting or moving elsewhere. It’s not just the cost of housing that is driving despair among the young. It’s the fact that soaring home prices have not been offset by rising wages for younger Canadians. Their earnings have remained stagnant in real terms for decades. In 1985, according to Statistics Canada, the median after-tax income for a 25 to 34-year-old Canadian worker was approximately $51,000 in today’s dollars. By 2022, that figure had inched up to just over $52,000. That’s a mere 2 percent increase over nearly forty years, barely keeping pace with inflation. Higher education, once the golden ticket to middle-class stability for young Canadians, has turned into an expensive gamble. The average tuition for an undergraduate degree in Canada has more than tripled since the early 1990s. The average graduate now carries more than $28,000 in student debt, with many owing far more. And unlike previous generations, many of today’s graduates are finding that their degrees do not guarantee stable, well-paying, middle-class jobs. Instead, they are bouncing between short-term contracts, part-time gigs, and side hustles just to make ends meet. According to a 2024 Harris survey, 87 percent of Canadian job seekers have worked a side gig at some point in their careers, with 29 percent currently maintaining a side gig during company hours. This trend is more pronounced among younger generations, with 41 percent of Gen Z and 47 percent of millennials indicating they would work a side gig on company time if they thought they could get away with it. The combined impact of skyrocketing housing costs, stagnant wages, precarious employment, and the rising cost of higher education has left many young Canadians trapped in an extended adolescence. Unable to afford homes, they are delaying marriage and children while relying on financial support from their parents well into their thirties. Nearly 40 percent of Canadians aged 20 to 34 still live with their parents—the highest proportion in modern history, according to Statistics Canada. In Toronto, that number jumps to 47 percent, almost half. Similar trends are playing out across Canada’s major cities, where an entire generation is being locked out of the financial independence that defined their parents’ early adulthood. As young Canadians struggle, their parents and grandparents are doing just fine. In the economic race between young and old, older Canadians are winning decisively, while younger Canadians are falling further behind. The financial divide between generations has never been wider, and the data proves it. If homeownership is an impossible hurdle for most young Canadians to overcome, for many older Canadians, it’s a windfall. The average homeowner who bought in the 1980s or 1990s has seen their home value increase five or six times over. Many are mortgage-free and have hundreds of thousands, if not millions, of dollars in home equity. The income gap tells a similar story. Whereas wages for younger Canadians have stagnated for decades, Canadian workers between 55 and 64 have seen their after-tax incomes rise by more than 30 percent in real terms since 1985. Their wages have kept pace with inflation and then some. Their wealth has accumulated while younger generations scrape by, drowning in debt and struggling with a cost of living that has soared far beyond their earning power. The retirement gap is just as stark. Many older Canadians are sitting on gold-plated pensions, benefiting from generous employer-sponsored plans that younger Canadians can only dream of. The percentage of workers covered by a defined benefit pension plan has plummeted from 46 percent in the 1970s to just 22 percent today, with most of those remaining plans held by government workers. For those without a pension, there is the Canada Pension Plan, Old Age Security, the Guaranteed Income Supplement for low-income seniors, and private savings. Older Canadians have had decades to accumulate wealth. The median net worth of Canadians aged 65 and older now exceeds $1 million, while Canadians under 35 have a median net worth of just $48,000. Not only are young people locked out of homeownership and economic security, they are also expected to bear the financial burden of an aging population. Canada’s fertility rate has collapsed to 1.26, far below the replacement rate of 2.1, meaning fewer workers will be responsible for supporting a growing number of retirees. Today, there are roughly three working-age Canadians for every senior. By 2040, that ratio is projected to drop to two to one. The costs of health care, pensions, and social services will skyrocket, all funded by a younger workforce already struggling to build financial stability. Once a country falls into demographic decline, reversing the trend becomes nearly impossible. Without decisive action, Canada faces a future of declining living standards, shrinking economic influence, and deteriorating quality of life. The numbers do not lie. If the birth rate continues to fall and young people remain locked out of economic opportunity, Canada will become smaller, poorer, and politically unstable. It will be a nation defined by economic stagnation, intergenerational conflict, and an aging population demanding ever greater support from an overburdened and shrinking workforce. For now, Canada’s economy is sustained by the spending power of older generations who benefited from decades of rising home prices, stable employment, and defined benefit pensions. But this financial cushion will not last forever. As boomers begin transferring their wealth, many younger Canadians will find little left to inherit. Rising long-term care costs, reverse mortgages, and increasing tax burdens will erode much of the financial security that older generations accumulated. The long-promised intergenerational wealth transfer may be more of a trickle than a flood. This growing disparity is not just an economic issue. It is a political crisis in the making. The concentration of wealth among older Canadians is fuelling resentment and creating the conditions for social unrest that could shake the foundations of Canadian society. If younger generations come to see Canada as a country that serves only the interests of older and wealthier homeowners, they may choose to dismantle the system rather than work within it. If they do not expect to inherit a social safety net for the elderly that their taxes support, they may vote for politicians who propose to scrap the net altogether. For young Canadians already locked out of the housing market and struggling to build stable careers, immigration is another added pressure they cannot ignore. The promise of immigration has always been one of economic growth, innovation, and a stronger workforce. And for much of Canadian history, that promise held true. But today, millions of permanent residents, international students, temporary workers, and asylum seekers compete with younger Canadians for housing, wages, and public services. New arrivals push up housing costs and push down wages, with younger workers paying the price. A 2024 report from Statistics Canada showed that the labour force participation rate for immigrants is now higher than that of Canadian-born workers. The solution is not to shut the door on immigrants but to ensure that younger Canadians are not forced to compete with newcomers for a place to stay and for a living wage. For many young Canadians, the economic struggles of today are not just about money. They are about hope—or rather, the lack of it. The relentless combination of unaffordable housing, stagnant wages, rising costs, and a precarious job market takes a psychological toll. Anxiety and depression among young Canadians are at record highs, with mental health professionals pointing directly to financial instability and uncertainty about the future as driving factors. According to a 2024 survey by the Canadian Mental Health Association, more than 50 percent of Canadians aged 18 to 34 report feeling pessimistic about their financial future. The result is a generation that feels trapped—unable to see a viable path toward financial security and stability. This despair manifests not only in personal anxiety but in a broader disengagement from national institutions and even national identity. Surveys report that between 20 and 30 percent of young Canadians express strong national pride, compared to more than 60 percent of those aged 55 and older. The declining faith in Canada’s future is not hard to understand. When young people struggle to secure necessities, when they feel priced out of their own cities, when they see no realistic way to build a stable life in their own home, attachment to their country can only weaken. The ethno-cultural composition of today’s young Canadian population also contributes to the weakness of national attachment. Gone are the days when the typical Canadian youth was a church going, hockey-playing descendant of European stock. Today, many young people found in the sprawling suburbs of major cities celebrate Diwali or the Lunar New Year, tracing their roots to continents other than Europe. Such diversity fuels cultural and economic innovation, but it can also make it harder for everyone to have a shared understanding of their society and a shared set of assumptions that anchor it. Canada’s ethnic diversity has reached levels that may never have been experienced by any country. The 2021 census revealed that nearly 27 percent of Canadians identify as visible minorities, a figure that reaches 55 percent in both greater Toronto and Vancouver, making the term “minority” meaningless. The younger members of these communities grow up as Canadians but also embrace global influences far beyond the European roots of previous generations. Cleavages emerge between the rural parts of the country, where the culture retains its white, Christian, European identity, and cosmopolitan cities in which many residents shop at a Tamil grocer, worship at a Sikh gurdwara, or send their child to a Mandarin immersion school. Religious affiliation among young Canadians is also changing at an unprecedented pace. While most Can adians once con sidered themselves Christians, at least culturally—showing up for church at Christmas and Easter; getting married there; having their babies baptized—the 2021 census showed that 35 percent of Canadians now report no religious affiliation at all, even as the number of people identifying with Islam, Hinduism, Sikhism, and Buddhism grows rapidly, particularly among younger generations. Unlike their parents and grandparents, who often maintained rigid cultural distinctions, today’s youth fluidly blend influences from multiple backgrounds. They listen to K-pop, watch Bollywood films, mix English or French with their parents’ native tongue, think nothing of eating sushi at lunch and grabbing a shawarma after work. More than 450 ethnic or cultural origins were reported in the last census, a staggering reflection of just how complex Canadian identity has become. As immigration reshapes Canada’s demographics, it is also redefining the country’s political, economic, and cultural future. A nation built by French and English and Irish, by Germans and Ukrainians and Italians and Greeks, by settlers scattered in farms and towns and cities across a vast, cold landscape, is now submerged in a dense, urban matrix of multi cultures. Societies with cultural, religious, and linguistic differences risk civic unrest unless they are able to master a shared national purpose. While Canada embraced its multicultural mosaic, the United States insisted that newcomers embrace the American Way, whatever that way might be. Other societies, such as Japan or South Korea, have preserved distinctive national identities by largely excluding newcomers. The challenge facing Canada in the third decade of the 21st century is not whether it can continue to grow through immigration, but whether it can project a sense of national self that all newcomers can understand and embrace— a national identity in which both they and native-born citizens see themselves as part of the same future. If that effort fails, fragmentation and resentment will follow. This challenge is not only cultural but economic. If the next generation, regardless of its cultural heritage, does not see Canada as a place of opportunity, it will disengage, not just from the economy but from civic life, politics, and the very idea of Canada itself. If nothing changes, the country risks losing more than just economic productivity. It risks losing the trust and investment of its own future. The crisis of confidence and faith in the future among younger voters has led to a tectonic political shift that few analysts saw coming: the shift of young voters to the right. For generations, young voters in Canada and across the Western world have been a reliable constituency for progressive parties. But that pattern is changing. Throughout the West, from Sweden to France to the United States, young men in particular are increasingly turning to right-wing and populist politics. The same trend is emerging in Canada. In the 2025 election, according to Nanos, 50 percent of voters under 35 supported the Conservative Party. This is not the first time young people have turned to conservative politicians. In the late 1970s and early 1980s, economic stagnation and growing frustration with government overreach led to a generational realignment. Young voters who had once favoured left-leaning policies turned to conservative leaders such as Ronald Reagan, Margaret Thatcher, and Brian Mulroney, who championed economic growth, personal responsibility, and a reduced role for government in daily life. The political preferences of younger Canadians today appear to be moving in a similar direction, particularly among young men who feel the status quo has failed them. While economic frustration is a major driver of this shift, another key factor is the changing perception of the left. Once the champion of the working class and youth, progressive parties are now widely seen as part of the political establishment. Young men struggling to build their futures see little tangible action from traditional left-leaning parties to address their concerns. Beyond economic grievances, a broader sense of anti-elitism drives this shift. Populist rhetoric that challenges government bureaucracy, cultural institutions, and academia resonates with those who feel ignored by political and cultural elites. This growing discontent is further amplified by cultural backlash. The youth crisis is not just a generational problem; it is a national one. Economic stagnation among young Canadians threatens long-term growth. If an entire generation is unable to accumulate wealth, the country’s economic future will suffer. Social fragmentation is another risk. The growing divide between young men and women in political beliefs and economic prospects could fuel generational resentment and even unrest. And politically, trust in democracy is eroding. The rise of populist movements signals a loss of faith in traditional parties and institutions, a warning sign for Canada’s stability. In January 2025, as Donald Trump rattled his annexationist sabre, Ipsos asked Canadians whether they would vote for Canada to become part of the United States. Eight in 10 said “never.” But four in 10 people under the age of 35 agreed with the statement that they would be willing to become citizens of the United States if they were offered “full citizenship, and a full conversion of the Canadian dollar and all personal financial assets into U.S. dollars.” That is how little attachment many of the younger generation feel towards Canada. If governments continue to ignore these warning signs, the consequences will be dire. A generation that sees no future in Canada will either leave or turn against the system entirely. We have already seen political upheaval in other countries where young people, especially young men, feel abandoned by their leaders. In France, mass protests over economic inequality have shaken the foundations of government. In the United States, the collapse of faith in institutions has fuelled the rise of populist movements on both the left and the right. Canada is not immune. If young people believe the system is rigged against them, they will seek radical alternatives. The economist Albert O. Hirschman identified three ways in which individuals respond to dissatisfaction: exit, voice, and loyalty. Exit is the most extreme response, occurring when people leave a job, abandon a brand, or end a failing marriage. Voice involves expressing concerns and advocating for change, whether through protests, negotiations, or reform efforts. Loyalty keeps individuals committed despite their frustrations, often delaying exit and encouraging voice as a means of improvement. Discussions about the crisis facing young people largely assume their loyalty, with some demanding voice. But what if exit becomes the more attractive option? Exit is not a myth or a distant threat; it is already happening. The numbers tell the story. Since the pandemic ended, more than a hundred thousand people have left Canada permanently each year in search of better opportunities abroad. More are leaving each year than left the year before. Many are young, highly educated professionals who see little future in Canada’s high-cost, low-opportunity economy. If this trend continues, the country risks losing its most promising talent. What happens when the most productive members of society decide they are better off elsewhere? As for those young Canadians who stay, if they no longer see a future in this country, they will stop investing in it. They will not buy homes. They will not start businesses. They will not build families. A nation where an entire generation disengages is a nation in decline. By the time the political class takes notice, it may be too late, but this crisis did not emerge overnight. For years, successive Canadian governments ignored clear warning signs, failing to act on housing affordability, wage stagnation, and economic opportunity. The result has been a slow but relentless erosion of economic mobility. This erosion is not the product of an unrestrained free market but rather of excessive government intervention. Well-intentioned but restrictive zoning laws have choked housing supply, sending prices skyrocketing. Burdensome credentialling requirements have blocked young people from entering skilled trades even as labour shortages worsen. High taxation and excessive regulation have stifled business investment, limiting the creation of stable, well-paying jobs. If government policies helped create this crisis, the solution is not more bureaucracy but the removal of barriers that prevent economic growth and opportunity. This failure is not partisan; it is systemic. Both progressive and conservative governments at all levels have side-stepped these issues, prioritizing short-term political calculations over long-term generational stability. The message to young Canadians has been clear and consistent. Their struggles are not a priority. But a political realignment is coming. As young people recognize that the existing parties have little interest in addressing their concerns, new movements will emerge. Whether driven by the populist right, the radical left, or something entirely different, change is inevitable. Political leaders who fail to grasp this reality do so at their peril. If they refuse to act, they will soon face a reckoning from a generation with nothing left to lose. Excerpted from Breaking Point: The New Big Shifts Putting Canada at Risk by Darrell Bricker and John Ibbitson. Copyright © 2025 Darrell Bricker and John Ibbitson. Published by Signal/McClelland & Stewart, a division of Penguin Random House Canada Limited. Reproduced by arrangement with the Publisher. All rights reserved.