More and more youngsters in America in the age group 16 to 24 are working this summer. This has pushed the unemployment rate for the group to a 52-year low. However, there is a catch to it. The labor force participation rate is still below its 1989 peak for young Americans.
The latest government data suggests that young Americans who are willing to work are getting jobs very easily. Despite that, the lagging labor force participation rate is pointing to a longer-term trend of teens and college going students opting for volunteer work, summer school or other unpaid activities. The reason for this is, teens and their parents believe that this would give them a better chance of getting a lucrative job or a competitive college.
According to a research from Stanford’s Jacob Leos-Urbel, summer jobs can help students perform better in the classroom when they return to school. They learn important skills on the job like team work and customer interaction skills.
The unemployment rate was 9.2 percent in July for young Americans actively looking for work this summer. It is slightly lower as compared to 9.6 percent of the previous year. The BLS said on Thursday that this has been the lowest rate since 1966. It is interesting to note that the unemployment rate for young workers has halved since the recession period about a decade ago.
President Donald Trump, hailed the lower unemployment rate for young Americans via a tweet on Friday.
Looking closely at the data, the labor-force participation rate stands at only 60.6 percent. This is much below its peak of 77.5 percent in July 1989. This labor-force participation rate illustrates the share of 16 to 24 year olds who are working or looking to work.
The participation is at a record low for 16 to 19 year-olds in particular. Only 35 percent of that age group are working or looking for work. This is the lowest figure since record-keeping started in 1948.
It is true that some teens and young adults feel discouraged by the job market. One big reason is the shifts in the retail and fast-food industries. Traditionally, it had been easier for teens to find their first job in this sector. A number of brick-and-mortar stores have closed in recent years owning to the fact that Amaericans have shifted their spendings on online stores such as Amazon.
According to a research conducted by JPMorgan Chase, some teens are less likely to find employment as compared to others. For example, young black men are less likely to be employed than their white counterparts.
The same findings were revealed in the BLS data. It says that young black Americans have an unemployment rate of 16.5 percent in July. This is more than double the 7.6 percent rate for young white workers.