Canada's ambitious AI leap: What happens to workers in a tightening labour market?

Therese Wood is a Toronto-based writer working in the deep-tech and aerospace sectors, specializing in emerging technologies and international business.

When the Gutenberg printing press swept across Europe in the 1400s, people panicked. Fearing job losses and the proliferation of uncontrolled information, scribes and authorities in cities like Paris smashed the presses and ran printers out of town.

History, as the saying goes, rhymes. Attacks on data centres are already being reported in the US, revealing mounting anxiety over AI’s impact on society and the economy.

To prepare for the next economic transition, the Canadian government revealed the six pillars of its new AI strategy in late April 2026, covering: privacy and democracy, worker training, business adoption, AI infrastructure, investment in AI business, and global partnerships.

Minister of AI and Digital Innovation, Evan Solomon, later signalled to reporters in early May that the ministry was working on a plan to address AI’s impact on workers. On May 27, Prime Minister Mark Carney announced that the full national AI strategy would be released the following week.

For now, Canada remains focused on AI growth. At Toronto Tech Week 2026, Minister Solomon acknowledged growing anxieties but cited a Bank of Canada report stating that AI had not led to widespread job loss: “Does that mean we shouldn't worry about job displacement and training skills? Absolutely not.”

Simultaneously, Solomon stressed that Canadians are among the lowest adopters of AI in the OECD, and that the country must “be careful about overly worrying about job losses before we've had adoption… then we'll see what happens.”

Meanwhile, life is growing harder for Canadian workers. Layoffs have been rolling through the tech sector for years, and many recent grads are hard-pressed for work, as reported by the Labour Market Information Council in late 2025. 

According to a Fraser Institute analysis of Statistics Canada data, 437,000 young people were unable to find work throughout 2025, while youth unemployment reached 14.3% in April 2026. That’s a steep 57% increase over three years, as outlined by the Fraser Institute.

At the same time, 111,000 full-time jobs were eliminated in the first four months of 2026, including 40,000 BC jobs. This is an extended trend. In early 2025, for instance, tech job postings were already down in Vancouver (43%), Montreal (21%), and Toronto (10%), per Indeed analysis.  

That labour-market pressure cooker is heating up as automation is being folded into the trades, finance, administration, and even trucking. “New grads are really expected to arrive AI-ready, not learn on the job,” says Shauna Begley, Program Head at BCIT Business Information Management. Several years ago, entry-level roles required manual tasks. Today, successful graduates are those with “distinctly human skills.” 

White-collar jobs are most likely to be affected in the near term, especially entry-level roles that involve “first-pass” tasks, explains Peter Copeland, Deputy Director of Domestic Policy at the McDonald-Laurier Institute. Canada finds itself “in what Waterloo economist Joel Blit calls the Replacement phase,” Copeland says. This change can improve productivity, but may leave young workers without valuable experience.

To improve AI literacy and adoption, Copeland champions the need for further AI education and workforce training: “Many people are using AI to do the same tasks slightly faster, which is useful but not transformative.”

In the US, there are more glaring signs of transformation. In May 2026, leaked audio surfaced suggesting that AI was allegedly being trained to perform human jobs by tracking Meta workers' computer activity. That same month, the company began to cut 8,000 roles as it shifted its focus toward AI.

Among industry leaders, perspectives on AI’s impact on jobs are somewhat scattered. Microsoft's AI Chief, Mustafa Suleyman, presented a bold projection in February 2026, telling the Financial Times that AI could automate a majority of white-collar tasks within 12-18 months.

Other leaders of the AI revolution, including Elon Musk and Peter Diamandis, frequently tout AI’s ability to scale productivity, save lives, and generate an abundance of everything, while acknowledging radical job disruption. Speaking virtually at a conference in Sydney on May 26, OpenAI CEO Sam Altman backtracked on previous predictions, stating that AI is unlikely to cause a "jobs apocalypse."

Proponents also point to the many jobs AI will create or augment. Laura McDonough, Associate Director of Knowledge Mobilization and Insights at the Future Skills Centre, expects research scientists, physicians, lawyers, and real estate agents in particular, to benefit. Those working in sales and administration may be at greater risk, and without extensive re-skilling, she explains, they could have an especially difficult time transitioning.

Technological revolutions, like the advent of the printing press, reveal that when societies fail to manage such transitions, they risk entrenching generational winners and losers. In an already constrained job market, that could lead to economic and societal destabilization.

“It’s not necessarily that a job will be replaced,” Begley clarifies, stressing the importance of worker adaptability, responsibility, and critical thinking when it comes to AI. Constant learning is “just going to be something we’re going to need to get used to.” As workers prepare for an AI-centric world, Begley also sees job opportunities emerging in data literacy and managing AI, including data management and AI governance.

As a leader in AI research and innovation, Canada is well-positioned to help set a global standard — not only for AI growth, but for managing its human impact.

Therese Wood is a Toronto-based writer working in the deep-tech and aerospace sectors, specializing in emerging technologies and international business.