One in four Canadian employees are anxious about getting laid off in 2026.
TORONTO–(BUSINESS WIRE)–As 2025 comes to a close, a new poll from Employment Hero, a leader in employment solutions for Canadian businesses, reveals a workforce grappling with uncertainty. The survey of over 800 Canadian employees (part-time and full-time) explores how this year’s challenging job market has impacted employees’ career progression and expectations, as well as fears about how they will fare in next year’s job market.
GEN Z ENDS 2025 UNDEREMPLOYED AND HUNGRY FOR CHANGE IN 2026
In 2025, economic uncertainty, exacerbated by the trade war with the U.S., created a challenging job market for Canadians as many employers slowed down or froze hiring. While the job market crunch was felt across the workforce, the survey found Gen Z employees might be bearing the brunt of it as they experience underemployment, misalignment with their desired career fields, and a lack of confidence in career advancement opportunities.
The survey found that one in five employed Canadians (22%) say their roles are below their education level. This sentiment is shared by nearly a quarter of those with university degrees (24%) and college-level education (23%). However, this issue is most prevalent among Gen Z. Almost one-in-three Gen Z employees (32%) report that their job falls short of their education level, compared to only 20 per cent of Millennials and 16 per cent of Gen X employees. The same pattern is apparent when it comes to employees working in their desired fields. While 31 per cent of employed Canadians say their current role is not in their desired field, this is a reality for almost half of Gen Z employees (46%) – significantly higher than the 28 per cent of Millennials and 25 per cent of Gen X who say the same.
Looking ahead to 2026, there’s a notable gap between the recognition Gen Z employees feel they deserve from their employer versus what they actually expect. 82 per cent of Gen Z employees believe they merit a raise next year, but a smaller 53 per cent anticipate one will be given. Expectations around promotions follow a similar trend – while 62 per cent of Gen Z employees feel they deserve a promotion in the upcoming year, only 32 per cent actually expect one.
“The job market has been tough on everyone this year, but especially on Gen Z, who are just getting started in their careers,” says Kevin Kliman, President of Canadian Business at Employment Hero. “While it can be challenging for employers to offer career progression amidst economic uncertainty, there are other meaningful ways to invest in Gen Z’s success. It starts with hearing them out – why do they feel a mismatch between their goals and their current role? From there, you can work together to identify opportunities for mentorship and exposure to different aspects of the business to support their growth.”
Despite these setbacks, Gen Z employees aren’t waiting around — many are taking matters into their own hands and seeking new opportunities elsewhere. Half of Gen Z (55%) employees plan on looking for a new job in 2026, compared to 39 per cent of Millennials, 30 per cent of Gen X, and only 6 per cent of Baby Boomers employees.
LAYOFF FEARS LOOM OVER CANADIAN WORKFORCE, SPARKING FINANCIAL ANXIETY
Layoffs were a common symptom of the challenging job market in 2025, and the survey found many Canadian employees are worried they will carry into 2026. 16 per cent feel they are at risk of getting laid off next year, and one in four (25%) are anxious about the possibility. This anxiety is also impacting their spending – 26 per cent of employed Canadians plan on delaying major financial decisions in 2026 due to the risk of getting laid off.
Layoffs are most concerning to employees in Ontario and Alberta, with 20 per cent of employees from both provinces indicating they are at risk of getting laid off in 2025. Both provinces have major industries that were significantly impacted by the trade war with the U.S., ranging from vehicle manufacturing in Ontario to oil and gas in Alberta. 29 per cent of Ontario employees and 24 per cent of Albertans employees are anxious about the potential of getting laid off – the highest rates in the country.
“Anxiety around potential layoffs can ripple through a workplace. It affects morale, focus and how teams show up for each other,” says Kliman. “In times like these, people look to their leaders for stability and transparency. When employers communicate openly, share their plans and give employees a sense of what to expect, it eases a lot of that tension. Trust is built in those moments.”
Employment Hero’s complete data findings are available upon request. To learn more about Employment Hero, visit https://employmenthero.com/en-ca/.
About Employment Hero
Employment Hero is the global authority on employment, offering a world-leading Employment Operating System (eOS) that simplifies and optimizes every stage of the employment process. Its award-winning platform combines HR, payroll, recruitment, and employee engagement tools with the groundbreaking employment superapp, EH Work, which integrates career management and financial well-being. Serving over 350,000 businesses and managing more than 2 million employees worldwide, Employment Hero reduces administrative burdens by up to 80%, enabling organizations to focus on their goals and create more productive, engaged teams. By revolutionizing the employment marketplace, Employment Hero is making employment easier, more valuable, and rewarding for everyone. For more information, visit http://www.employmenthero.com/en-ca.
Survey Methodology
These findings are from a survey conducted by Employment Hero from November 10th to November 12th, 2025, among a representative sample of 821 online adult Canadian employees who are members of the Angus Reid Forum. The survey was conducted in English and French. For comparison purposes only, a probability sample of this size would carry a margin of error of +/-3.4 percentage points, 19 times out of 20.
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Anne-Marie Tremble
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