Summer Jobs Forcast: Dry
Teens might be in for another job drought this summer.
For the sixth summer in a row, teens will fare very poorly in the job market, predicts Andrew Sum, director of the Center for Labor Market Studies at Boston’s Northeastern University.
That’s “somewhat puzzling,” given the declining rates of national unemployment in recent years, says the center’s recent report, The Summer Teen Job Market in 2005 and the Predicted Outlook for 2006.
Teen summer employment rates have ranged from 36.3 percent to 36.8 percent nationally over the past three summers, the report says. Those numbers are startling when compared with the teen employment rate of the 1980s economic boom: In 1989, the report says, 48.4 percent of the population of 16- to 19-year-olds had summer jobs.
For many years, teen employment rates followed the nation’s overall employment rate: They fell during recessions, rose during recoveries, albeit behind the overall rate. Not so in recent years, Sum says.
The reason, according to his report: growing job competition from older adults (ages 55 and up), immigrants and young adults (20-24). One advantage of the competing groups is that they can usually work throughout the school year, while many teens cannot.
While a regression model predicts that teens might fare slightly better this summer than the last, “the increase will be one percentage point, at most,” Sum predicts.
The forecast is especially gloomy for minority and low-income youth. Last summer, according to the center, 22.4 percent of black teenagers worked, while less than one-third of teens living in low-income households held jobs.
Meanwhile, communities around the country continue trying new things to find employment for teens this summer. For example, Youth Opportunity Boston, a city job readiness program, plans to offer summer jobs to 150 teens with criminal records. The office of Mayor Thomas M. Menino raised $250,000 from private companies and institutions, including Harvard University, Northeastern University, the Yawkey Foundation and Citizens Bank, to fund the new $8-an-hour jobs, the Boston Globe reports.
Contact: Center for Labor Market Studies, Department of Economics (617) 373-2242, www.econ.neu.edu.
Youth Employment Funds Slashed? No, Just Stalled
Is Washington secretly slashing federal youth employment and training funds to the states? That’s what it looked like to some people when recent payments under the Workforce Investment Act (WIA) were far smaller than expected.
The U.S. Labor Department says it’s just a calculation glitch that involves counting kids in college dormitories – a glitch that might leave many states waiting months for the rest of their WIA youth training funds, which might ultimately total less than they got last year.
So far, states have gotten about 14 percent less than last year. Here’s what happened, according to officials at the Labor Department’s Employment Training Administration (ETA):
Three equal factors determine each state’s share of the training funds, which has steadily declined from $1.1 billion in fiscal 2003 to $950 million in 2006.
• The number of disadvantaged youth in the state.
• The unemployment rate in places designated by states to be Areas of Substantial Unemployment (ASUs), which are contiguous areas with populations of more than 10,000 and unemployment rates above 6.5 percent.
• The unemployment rate in areas not deemed to be ASUs.
Before this year, ASU figures were measured using 1990 Census data as a baseline. For 2006, the process was supposed to use 2000 Census data, according to Sherryl Bailey, an analyst for ETA’s Office of Financial and Administrative Services.
Among the things counted in the 2000 Census is the unemployment rate among those living in “group quarters,” which include college dorms, correctional and juvenile institutions and nursing homes. That helps to determine the second factor – the total unemployment rate in ASUs.
But the Bureau of Labor Statistics alerted ETA that an error in the 2000 Census data for group quarters would make the employment rates inaccurate for areas with a lot of people living in such facilities, Bailey says. She says the ETA tried using county employment data to determine the unemployment rates for ASUs, but that produced wild fluctuations from last year’s rates.
So states were instructed to run the numbers again using the 1990 Census as the baseline. Those figures weren’t due at ETA until late May, and Bailey does not expect the allocations to be finalized until July.
In the meantime, ETA says it allocated each state the minimum amount it could receive for the year by law. Each state should receive the larger of two figures: 90 percent of its 2005 funding, or one-quarter of 1 percent of the total funding for all states, which works out to about $2.3 million.