An analysis of newly-released Census Bureau data by the Employment Policies Institute (EPI) shows teen unemployment averaging above 25 percent in 25 states as of April 2011. When the analysis is broadened to include discouraged teens that have given up looking for work, the picture worsens across all states, with jobless rates averaging above 27 percent in 23 states and the District of Columbia. Michigan ranked 13th highest among the states at 27.9 percent. As is the case with the overall unemployment figures, the jobless rate only considers persons actually in the labor force. Research shows that a significant number of teens have already been frustrated by the combination of fewer jobs in the marketplace, many low skill jobs being filled by unemployed adults, and people in their early 20s who are taking some of those better teen jobs that usually they leave alone. These factors have resulted in a general lack of any response to teen applications.
“The economic downturn, combined with the consequences of increases in the minimum wage, has created a labor market that’s hostile for young, inexperienced job seekers.” said Michael Saltsman, research fellow at the Employment Policies Institute. Nationally, the teen unemployment rate stands at 24.2 percent for all teens, and 40.7 percent for black teens.
“Discarding the warnings of three-quarters of labor economists, policymakers at the state and federal level have supported wage and benefit mandates that raise the cost to hire less-experienced employees,” Saltsman continued. “In response, employers have been forced cut back on customer service or move towards automation—meaning fewer hours and fewer opportunities for people who used to fill those jobs.”
New research from Drs. William Even (Miami University) and David Macpherson (Trinity University) shows that the consequences of wage mandates at the state and federal level have been particularly severe for young black males without a high school diploma. They calculate that each 10 percent increase in the minimum wage has decreased employment for this group by 6.5 percent–more than twice the rate of young whites with the same education. Unless the job market significantly rebounds or government intervention occurs, teens will continue to face tough competition into next year.
“Teens are missing out on summer jobs where they can learn valuable skills not taught in the classroom,” Saltsman concluded. For teens, work can be more than just a paycheck, according to a report from the Center for Labor Market Studies. Teens who work in high school are less likely to drop out before graduation. The cumulative work people do in their teens can also result in a positive impact on the employment, wages and earningsthey have in their 20s, the report found.
In addition, teens unable to get work today are more likely to have trouble finding employment in the future. Low-income teens living in areas with fewer job opportunities have a greater likelihood of engaging in delinquent behavior. Areas with fewer jobs also tend to have higher rates of teen pregnancy as well.
Let us not forget the financial aspects of employment. Increasingly, teens are searching for work to save for college or provide support for their unemployed parents.
On March 22, 2011, DTE Energy hosted the second annual Detroit Youth Employment Summit. The summit, titled “Homegrown Talent: Envisioning Detroit’s Future Workforce Are We Ready?” welcomed over 250 people from across Southeast Michigan, including a panel of experts, and keynote speaker U.S. Senator Debbie Stabenow.
Sponsored by DTE, Bank of America, The Skillman Foundation, New Economy Initiative, The Detroit Youth Employment Consortium, The Detroit Workforce Development Board, and City Connect Detroit, the purpose of the event was to engage key stakeholders in a discussion about how to prepare young people for the workforce, and the importance of including employers in youth workforce preparation.
Employers across the city are coming together to provide youth with job opportunities through the Detroit Youth Employment Consortium. The task is great and there are many youth who will not be served. Find out how you can help by contacting City Connect Detroit or the Skillman Foundation.