By Andrew Sum and Nathan Pond
Substantially weakened national labor market conditions since the early winter of 2001 have dramatically reduced job opportunities for many groups of workers throughout the country, but no group has suffered more than young people ages 16 to 24.
This group bore the brunt of job losses during the recession and has fared poorly in the recovery. Suffering most are those who are most often ignored by economic policy-makers and who have limited ability to organize politically: youngsters who are out of school for the summer, and out-of-school youth who have no post-secondary schooling or informal networks to help propel them into the working world.
This summer was characterized by the lowest employment rate among the nation’s teens since the summer of 1965. The teen employment rate (seasonally adjusted) during June and July was only 38.9 percent, 7 percentage points below the summer of 2000, when the national economy neared its cyclical peak.
Rather than demanding government initiatives to bolster employment opportunities for the nation’s teens this summer, a number of the nation’s leading news organizations – including CNN.com, USA Today, and the Washington Post – ran stories focusing on the theory that many teens simply do not wish to work. The youths supposedly preferred to “work on their tans,” hang out with friends and enjoy their summer leisure.
Some news stories emphasized that recent college graduates have had trouble finding suitable employment, but said nothing about the problems of young adults who have less schooling and few contacts in the work world.
What is the empirical evidence on these issues? Contrary to the largely anecdote-based stories on teens not wanting to work, U.S. Bureau of Labor Statistics data on official teen unemployment, hidden unemployment, and underemployment (from the May-July Current Population Surveys) suggest an extraordinarily high desire on the part of youngsters for more jobs and more hours of employment.
On average, over the May-July period of this year, 1.52 million teens were unemployed, another 1.41 million teens wanted to work but had not actively looked for a job in the past four weeks (and thus were not counted as unemployed), and 553,000 employed teens were working part time because they could not obtain full-time jobs.
This adds up to nearly 3.5 million, or 22 percent of the nation’s teenage population and almost half the number of employed teens over the May-July period.
Clearly, the nation’s young people have suffered heavily for the second summer in a row without any federally funded youth jobs program. And without a voice, their story is not often told.
Our findings on employment losses among out-of-school young people (16 to 24) since the late fall of 2000 also show that high school dropouts and high school graduates with no college experience were the most harmed by the recession and least helped by the recovery. The employment rate for young four-year college graduates had declined the least: a little more than 1 percentage point, versus 4- to 5-percentage-point drops in the employment rates of out-of-school youth with 12 or fewer years of schooling.
During June and July of this year, the employment rates for the nation’s out-of-school young people (16-24 years old) ranged from a low of just under 50 percent for those lacking a high school diploma to 84 percent for four-year college graduates. Among young black adults with no high school diploma, fewer than one-third were employed this summer.
This is not to diminish college students’ labor market difficulties. They are having a more difficult time finding jobs linked to their fields and – being bumped down the queue by out-of-work adults – are taking jobs that would normally have gone to young high school graduates and dropouts.
All this bad news for teens cries out for a national jobs strategy to help get them back to work. The economic case for a comprehensive, year-round job creation program for the nation’s young adults is strong and should be debated by Congress now.
The problem won’t go away any time soon: The limited demand for youngsters will continue well into next year, and possibly beyond. Better to address the problem now than to simply tell youth to wait for the economy to recover on its own.
Andrew Sum is the director of the Center for Labor Market Studies at Northeastern University. Nathan Pond is a research associate. Christine Phelan, assistant director of University Communications, contributed to this report. Contact: s.palma@neu.edu.
