In yesterday’s Twenty-Four, we looked at how Alberta’s labour market performed last year in terms of employment growth and the unemployment rate. In a nutshell, although Alberta had the highest rate of employment growth in the country, it was not enough to keep up with a surge in job seekers so its unemployment rate stayed elevated.

Today’s Twenty-Four digs into the annual results by age, type of work (public sector employee, private sector employee or self-employed) and industry. Not surprisingly, there is quite a bit of variation in the outcomes across these variables.

Youth unemployment elevated

Alberta residents aged 15-24 (a.k.a. youth) accounted for about 14% of the provincial labour force last year. While it is typical for the youth unemployment rate to be higher than the overall average,* 2025 stands out as a particularly tough year for young people looking to gain traction in the labour market.

The youth unemployment rate in Alberta last year was 15.7%, more than double the overall rate of 7.2%, almost two points above the national youth unemployment rate of 13.8%, and the highest rate in the province (not including the first year of the pandemic) since 1984.

The increase in the youth unemployment rate last year happened despite a 3.9% rise in youth employment. The problem was that the growth in the youth labour force was even greater at 5.4%.

Higher-than-normal competition for entry-level jobs due to a recent spike in in-migration helps explain the elevated rate of youth unemployment. With the number of non permanent residents (NPRs) now falling, the youth unemployment rate should ease somewhat going forward. We have already seen this happening with the (seasonally-adjusted) monthly youth unemployment rate trending downward since the summer. The rate peaked in July at 20.3% but was down to 14.5% as of December.

For workers aged 25 and over, employment growth and labour force growth were almost in balance, with the labour force increasing by 2.68% versus 2.67% for employment, resulting in an annual unemployment rate that remained the same as the year before at 5.8%.

*Factors in play here include the transition from school to work, less experience than older workers, and more temporary employment among younger workers.  

Public sector leads in employment growth

About 1 in 5 employees in Alberta work in the public sector.** Although private sector employment grew by more than public sector employment in absolute terms last year (37,900 versus 26,800), the annual rate of growth was much higher in the public sector at 5.9% compared to 2.2%. The rapid rise in Alberta’s population helps explain the jump in public sector work as more people were required to perform essential services in areas like health care and education.

In Canada as a whole, public sector employment growth also outpaced the private sector, but by a more modest amount (1.9% versus 1.3%).

For the 350,000 or so Albertans whose primary job*** took the form of self-employment last year (about 14% of total employment in the province), the rate of growth was 1.9%, up from a decrease of 3.1% in 2024.

**Those who work for a local, provincial or federal government, for a government service or agency, a crown corporation, or a government funded establishment such as a school (including universities) or hospital.

***The Labour Force Survey only counts the job at which respondents usually work the most hours so if they have multiple jobs, whether as employees or via self-employment, those jobs are not included in the results.  

Construction sector added the most jobs

The services-producing sector accounted for 96% of total employment growth last year, but it was construction that added the most jobs of any single industry category at +12,800. This was followed closely by health care and social assistance at +12,400.

Industries that saw their annual employment level drop include oil and gas (which includes a small number of mining jobs) at -10,000, other services (e.g., auto repair shops, hair salons, churches, nannies and house cleaners) at -8,700 and manufacturing at -3,900.  

Trade headwinds linked to U.S. tariffs are a key culprit behind the pullback in manufacturing employment. Widespread concerns about the cost of living are a factor in the drop in other services employment as people cut back on discretionary spending.

For oil and gas, it’s not unusual for employment to fluctuate significantly as market conditions and investment levels shift. Last year’s drop of 10,000 likely reflects the combination of lower oil prices, ongoing efficiency gains, and consolidation in the industry. However, the reduction in 2025 came after the addition of almost 18,000 positions in 2024 and employment in the sector last year remained higher than the 10-year average, though it was still well below the 2014 peak.

Answer to the previous trivia question: Between 1976 and 2025 (the current data series), Alberta’s annual unemployment rate peaked outside the pandemic at 11.3% in 1984. The highest annual rate was 11.4% in 2020 when the pandemic had shut down large parts of the economy.

Today’s trivia question: True or false? Although Alberta has a smaller population than B.C., it added more jobs last year than its neighbour to the West.