The National Teen Jobs Crisis Revisited: Taking Stock of Its Dimensions

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While the recent release of the national October 2010 payroll jobs numbers provided further evidence of a recovery in private sector jobs, the numbers from the monthly CPS household survey for the nation’s teens for the same month tell a far different story. For the fifth consecutive month, the teen (16-19) employment rate (seasonally adjusted) has remained below 26 percent, and the nation is well on its way to generating another new historical low for the annual average teen employment rate. This will be the fourth consecutive year in which such new employment lows have been reached.

The job losses for teens have piled up at extraordinary rates over the entire past decade. Teen employment rate declines have been very high for each single age group over the 2000-2010 period, with declines of 16 to 20 percentage points for every single age group, the highest by far of any age group in the labor market (Table 1). Thus far in 2010, only 11 of every 100 of the nation’s 16-year-olds and 22 of every 100 17-year-olds were employed in any type of job during a given month (Table 1). The younger the teen, the greater was the relative decline in his/her employment rate. If teens in each age group had been able to maintain their 2000 employment rates, there would have been another 3.25 million teens at work this year.

Table 1:

Trends in the Employment Rates of the Nation’s Teenagers by Single Age Group (16-19) from January-September 2000 to January-September 2010 (in  percent)

 

 

 

 

Age Group

(A)

 

 

2000

(B)

 

 

2010

(C)

 

Percentage

Point Change

(D)

 

Percent

Change

16

29.8

11.1

-18.7

-63 percent

17

42.1

21.8

-20.3

-48 percent

18

51.5

32.9

-18.6

-36 percent

19

60.7

44.7

-16.0

-26 percent

16-19

45.7

26.3

-19.4

-43 percent

 

The steep declines in employment opportunities for the nation’s teens over the past decade have been widespread across nearly all major industries and occupations. However, employed male and female teens have found themselves increasingly shut out of key industries and becoming more heavily dependent on food services, accommodation industries, and retail trade for the bulk of their jobs. Between the first four months of 2000 and 2010, we estimated that male teen employment declined by about two-thirds in construction and manufacturing industries and by more than half in transportation and utilities. In contrast, male employment in accommodation and food services fell by only 5 percent over the same time period. Among teen women, employment fell by nearly 60 percent in finance/insurance industries and by 44 percent in information services and professional/technical services by declined by only 14 percent in accommodation and food services. As a consequence of these dramatic shifts in the distribution of teen employment by major industry, in 2010, 54 of every 100 employed male teens and 63 of every 100 employed teen women worked in only two sectors:  accommodation/food services and retail trade. This results in their being exposed to a limited range of job skills and training opportunities.

The job losses of teens have been quite high for out-of-school youth, including both high school graduates and high school dropouts. These out-of-school youth also have been facing severe difficulties in finding full-time work when they do become employed. Only 40 to 45 percent of employed, out-of-school teens were working full-time during the first half of this year. Their lack of full-time work experience will reduce not only their current earnings but also their future employability and their wages as they move into their early 20s. Our research findings also indicate that more limited work experience during the teen years will reduce the amount of training that they will receive from their employers from their early to mid-20s. Work experience today begets more future work experience and other human capital investments.

The results of the November Congressional election will surely complicate the task of securing new workforce development programs for the nation’s teens. Members of both political parties, however, should be encouraged to see the overwhelming importance of a bipartisan approach to substantially expanding youth work opportunities. We will spell out some of these alternatives in our next blog.