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Unemployment is lower than it has been in 18 years, and summer hiring is expected to be strong. But more teens are opting not to work, according to labor market research.
The labor-force participation rate, a measure of the share of people with jobs or looking for employment, was 43 percent for teens last summer, down about 20 percentage points from July 2000—the last time the unemployment rate was around 4 percent—and down almost 30 percentage points from in July 1978.
"Even though some teens still have summer jobs, the proportion of teens who participate in the labor force during the summer has dropped dramatically," said Teresa Morisi, an economist at the Bureau of Labor Statistics (BLS). Teen labor force participation overall has been on a long-term downward trend, and the decline is expected to continue, she said.
Forty years ago, nearly 58 percent of teens were working or looking for a job. In 2000, 52 percent were in the labor force. In 2006, the rate was 44 percent. It declined during the Great Recession in 2007-09, falling to 34 percent in 2011, where it's remained since.
Researchers at the Drexel University Center for Labor Markets and Policy in Philadelphia expect that only around 30 percent of teens will have a summer job this year, according to a 2018 study.
That's not because they don't want to work, said Paul Harrington, director of the center, a professor of education and an author of the report. Teens have been unsuccessful in either finding sufficient hours of work or finding any work at all, he said.
He cited BLS data that shows nearly 1.1 million teens were counted as unemployed, meaning they were looking for work, in the summer months of 2016-17. Another 432,000 wanted to work full-time, but were working part-time because they could not find full-time work, and 886,000 teens wanted to work but had quit looking for a job. "This means that about 31 percent of the teen labor force was underutilized during the summer months of 2016-2017," he said, a higher rate than for any other worker demographic.
Why the Decline?
Experts believe that teen labor force participation has plummeted for a variety of reasons, including more participation in school activities, working gig jobs not tracked by federal data, rising minimum wages, and an increase in older and foreign workers taking jobs traditionally filled by younger and less-experienced employees.
Vicki Salemi, a careers expert for Monster and a former corporate recruiter, said that Generation Z is not lying around idle during the summer months. "There isn't as much urgency for teens to find jobs and earn money as with previous generations," she said. "They may be spending more time with friends, or volunteering, or doing more gig work projects on the side instead of taking on full-time jobs." She added that they're likely gigging several piecemeal jobs and getting paid in cash, so it's not necessarily factored into the official data.
About half of teens are interested in being business owners themselves, according to research from Monster, she said. "If they're thinking more about being entrepreneurs, that may account for [the drop in teen employment] too, even though they'll need to build the skill sets that you get from working."
Martha Ross, a fellow at the Metropolitan Policy Program at the Brookings Institution in Washington, D.C., believes that the decline in teen employment mainly derives from a growing focus on school. She noted that teen enrollment in high school or college classes during the summer was 42 percent in 2016, compared with just 10 percent in 1985.
Parents may think that time preparing for post-secondary education trumps any earnings teens may bring home from jobs typically not considered impressive resume-builders.
Minimum wage hikes are another significant factor in pushing teens out of the workforce, according to 2018 findings from researchers at the Mercatus Center at George Mason University in Arlington, Va.
There's also more competition for jobs traditionally held by teens. For decades, teenagers worked in food service, grocery stores and retail. At the end of the 1990s, teens accounted for nearly 25 percent of food service workers during the summer and about 20 percent of retail employees, Harrington said. Today, teens account for just 16 percent of summer food service workers and 14 percent of retail clerks, according to BLS data.
Meanwhile, the labor force participation rate of people aged 65 and older has increased to nearly 20 percent. Forty years ago, that rate was 13 percent.
"Teens who do in fact want jobs face competition from older workers—perhaps after retiring from their careers, underemployed college graduates, and foreign-born workers," Morisi said. "Older people are staying in the labor force longer than ever before. In addition, even though older workers may officially retire from their career jobs, many do not officially exit the labor force. Instead, they increasingly take on 'bridge jobs,' usually part-time or part-year and lower-wage jobs."
Employers have a preference for these workers, because of their superior soft skills and behavioral traits like reliability, Harrington said.
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