Youth and the Labor Force: Background and Trends
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Fernandes-Alcantara, Adrienne L.
[Excerpt] This report provides current and historical labor force information about young people ages 16 to 24. In general, youth have a lower rate of labor force participation, and those who are in the labor force are less likely to gain employment than older workers. Both labor supply and demand factors drive this pattern. On the labor supply side, young people are making greater investments in education by enrolling in and completing high school and college in greater numbers. They are less likely to be attached to the labor force due to their limited availability (e.g., only able to work full-time during the summer if they attend school) and their relatively weaker connections to employers. Labor demand also plays a role. Youth are less desirable in some ways than adult workers because they are less experienced; have fewer skills and education; and are potentially short-term hires, which can be costly to employers. The report focuses on trends from 2000 to 2018. This period has included two recessions (March to November 2001 and December 2007 to June 2009) and a decline in jobs requiring only a high school diploma. Many workers were still struggling to find work in the years immediately following the more recent recession. The recession exacerbated challenges that workers have faced in securing and retaining employment since 2000. Against this backdrop, young people ages 16 to 24 experienced their steepest decreases in labor force participation and employment; however, in recent years employment levels have steadily been recovering. Some studies have found that early labor market experiences and outcomes have lasting impacts on employability and wages. Given the current and future challenges that young people can experience in the labor market, this report may be of interest to Congress in the contexts of workforce development, education, unemployment insurance, youth policy, or macroeconomic policy; however, the report does not discuss specific programs or policy implications. The report begins with a brief discussion of current employment and education pathways that young people can pursue. Following this is a description of the labor market data used in the report, which includes the labor force participation rate, employment-population ratio, and unemployment rate.2 The report then discusses these data for the post-World War II period, with a focus on trends since 2000, comparing labor force outcomes based on age, sex, and race/ethnicity. The report concludes by exploring the factors that influence the extent to which youth participate in the labor force and their prospects for employment. The last section also discusses the potential short- and long-term effects of young people’s labor market experiences. The Appendix includes supplemental tables and figures on youth employment trends.
youth; employment; education; training; labor market