Teens Face a 'Lost Decade' as Summer Jobs Disappear
Business + Economy

Teens Face a 'Lost Decade' as Summer Jobs Disappear

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As she prepares to enter her senior year of high school, 17-year-old Jaclyn Brown figured this summer would be a good time to start building her resumé and earning some additional cash. “It would be nice to have some extra pocket change,” she says—money that could at least help cover the cost of gassing up her Chevy Tahoe.

Brown started looking for jobs in late April, focusing primarily on clothing, shoe, and jewelry stores near her school in Shreveport, La. “I almost refuse to work at a fast food restaurant because it’s so cliché and that’s not my kind of crowd,” she says. But after a couple of months of searching, she was excited last week when a regional chicken-fingers franchise called her back for an interview, and also optimistic about a possible job selling cutlery. For now, though, she says she’s mostly babysitting or “just chillin’” at home.

Whether they’re taking summer classes, volunteering, or just chillin’ like Brown, fewer teens are landing summer jobs. Last month, just 29 percent of teens had jobs compared with 51 percent in June 2000, according to data from the Bureau of Labor Statistics. And the teen unemployment rate has been above 20 percent since the beginning of 2009, an unprecedented stretch of 30 months. For the third straight year, summer unemployment among teens has hovered around 25 percent or higher.

Those disheartening numbers could also have implications further down the road. “Teens aren’t just missing out on some extra spending cash,” says Michael Saltsman, a research fellow at the Employment Policies Institute. “They’re missing out on some of the experience you get at your first job”—experience and skill-building that can help land a second job or set students on a path to future success.
 
A 1998 paper by economist Christopher Ruhm found that “jobs held during the senior year yield substantial and lasting benefits,” with seniors who work part-time earning about 20 percent more annually some six to nine years later than those who don’t work. On the other hand, researchers have found that those who go through a long period of unemployment at a young age are more likely to experience another stretch of unemployment later on.

Blame the recession—at least in part. The temporary and seasonal jobs teens often get are extremely sensitive to economic cycles. And the financial crisis and its lingering aftereffects have meant that fewer jobs are available for teens, and more competition exists for the positions that do open up. Senior citizens hit by the downturn are staying in the workforce longer—37 percent of those 55 and over are now working, up from 29 percent in 1986. “As they’ve stayed in the labor force longer, they’ve taken a lot of the jobs that have typically gone to teens,” says Joseph McLaughlin, senior research associate at the Center for Labor Market Studies at Northeastern University in Boston.

But the downward trend in teen employment dates back beyond the financial crisis, and economists point to a litany of other factors that have helped push teen employment to its lowest levels since the late 1940s. “This decade has been a lost decade, in many respects, for teens,” says McLaughlin.

An increase in the minimum wage from $5.15 in 2007 to $7.25 in 2009 has played a part in that—and drawn renewed criticism as the summer, and election season, heat up. The Wall Street Journal editorial page suggested this month that the Nancy Pelosi-led Congress contributed to the decline in teen jobs “by passing one of the most ill-timed minimum wage increases in history” and that “Even liberals ought to understand that raising the cost of hiring the young and unskilled while employers are slashing payrolls is loopy economics.” One recent study found that each 10 percent increase in the federal or state minimum wage decreased employment among white men aged 16 to 24 by 2.5 percent—and by 6.5 percent for black men in that age group. But other economists note that the steep decline in the proportion of teens who are working dates back to the early 2000s, well before the recent minimum wage hikes went into effect.

So what else is driving teens from the workforce?

Recent shifts in the educational system have been another key. Teens today have longer school years that eat into their availability for summer work. And, driven by tougher graduation requirements and academic pressures, more students are enrolling in summer classes both for high school and college. In fact, 53 percent—really, 53 percent!—of teens aged 16 to 19 were in school sometime during the summer from 2009, according to the Bureau of Labor Statistics, up from 19 percent in 1989.
 
More kids are also going to college than in the past, with many opting to spend their summers earning pre-college credits. And even as more young people pursue higher education, they are relying less on summer paychecks—and depending more on financial aid—to help pay for tuition. That may be because, given skyrocketing school costs, “teen earnings would make less of a dent now in paying for an education compared with past years,” writes Bureau of Labor Statistics economist Teresa Morisi in a May 2010 analysis of declining teen employment.

Morisi and others also say that diminished federal funding for summer jobs programs may be part of the problem, with local governments cutting back on summer hiring since 2002 as a result of the cutbacks. Restoring that funding could create new summer job opportunities, says McLaughlin of the Center for Labor Market Studies: “I would argue that the best way to turn this around is a renewed federal jobs program.” But President Obama and congressional leaders have been more focused on spending cuts and deficit reduction, making those new expenditures seem less likely.

For now, experts like Saltsman of the Employment Policies Institute recommend that teens who can’t find paid work at least pursue unpaid internships, volunteer positions, or other such opportunities. The chance to develop work skills and build their resumes could still prove valuable, now and in the future, since as Saltsman says, “an entry-level job is more than a paycheck.”

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