Makin' Money

Teenage wasteland

Chris Farrell Aug 24, 2011

The teenage job numbers are awful. The share of young people ages 16 to 19 who were employed in July was 48.8%, according to the Bureau of Labor Statistics. The employment-population ratio–the ratio of the number of people employed to the total working age population–is a broad measure of labor market health.

That’s the lowest ever for a series that dates back to 1948. July is typically the peak employment month for teenagers.

Of course, considering the terrible job market–the national unemployment rate is 9.1%–it’s hardly surprising that teens have had a tough time finding work this summer. By definition teens are at the bottom of the hiring hierarchy.

Still, these lousy numbers seem to scream that we’re creating a lost generation. And we are–in part.

For a majority of youngsters the decline in teenage unemployment reflects a long-term trend toward investing more in education.

For instance, summer school enrollment is some three times higher than it was two decades ago. Teenagers on the track to attend college often participate in extra-curricular activities rather take a job. Odds are these teenagers will eventually get the kind of jobs and incomes that justify the long investment in schooling.

The real problem is with low income youngsters, especially from African-American and Hispanic families. The unemployment rate among African-American teens in July was 31%. The comparable figure for Hispanics is 20.1%.

A major problem is that minority youths are concentrated in urban areas, while many of the kind of low-wage entry-level work is in the suburbs. In most cities there isn’t a good transportation network linking inner cities with far-flung suburbs.

So, there’s little cause for alarm to the extent that the lack of employment reflects greater investment in education. It would be better if more youngsters were working, but it isn’t a disaster.

The hostile job market is potentially disastrous for the long-term prospects for young adults from low income families. The financial barriers to college are steep and the high school dropout rate is high. Yet these young adults aren’t even learning on-the-job skills that can pay off over a lifetime. Now that’s an economic breakdown.

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