Don’t ignore America’s youth unemployment crisis
Recently, Reuters columnist Zachary Karabell proclaimed that “The Youth Unemployment Crisis Might Not Be a Crisis.” Having spent much of the past several years writing about record levels of youth unemployment and speaking with hundreds of struggling young adults across the country, I was intrigued to say the least.
In reality, the article itself does an excellent job demonstrating why youth unemployment is a crisis in America. Unemployment for 15- to 24-year-olds is nearly 16 percent, twice the national average. College graduates are doing slightly better, but young people with just a high school diploma face unemployment rates of nearly 30 percent. High schools dropouts fair even worse. Young people of color face truly shocking labor market conditions: for African American teenagers, the jobless rate is 40 percent. Economists predict this could have serious long-term consequences for the economy. One study claims that nearly 1 million unemployed young Americans will lose $22,000 each in earnings over the next ten years. Youth unemployment is an unmitigated disaster for young people and the economy as a whole.
Decades of economic data on youth joblessness shows that: 1) lack of work early in an individual’s career leads to lower future wages; and 2) entering the job market during a recession scales up individual challenges to entire generations. The data is as solid as it is disturbing.
In a report my organization, Young Invincibles, will release next month, we found that the research on wages fails to count social safety net benefits paid out to the unemployed, or that decades of research aren’t enough to draw conclusive opinions. Unfortunately, safety net programs do not help young people much; you can’t qualify for unemployment insurance if you’re looking for your first job.
Perhaps the droves of “college-educated” young people moving home with Mom and Dad are simply avoiding low-paying service jobs and holding out for something better? Unfortunately, this isn’t true either. College graduates have higher employment rates and higher labor force participation rates compared to less-educated young people. English BAs may get a bad rap, but they are not driving youth unemployment.
Few realize the extent of the problem. That lack of understanding is something I can identify with. As a college-educated man with a peer group of similarly educated people, I was shocked to learn that only 1 in 3 young people ages 25 to 34 have a 4-year degree. Eventually about four in ten Americans manage some kind of postsecondary credential, but that’s it. Most people don’t have one. Simply put, the majority of young people face staggering labor market challenges.
The problem has brewed for decades as increasing demands for skill have left less-educated young people with fewer jobs, lower wages, and worse prospects. Again, by “less-educated,” we mean “most young people.” Our education system simply hasn’t caught up with the new economy. Added to that, the worst economic nosedive since the Great Depression disproportionately impacted our generation. Put those ingredients together and you have a crisis.
PHOTO: Job seekers wait to meet with employers at a career fair in New York City, October 24, 2012. REUTERS/Mike Segar