Teen unemployment hits all-time highs
Given that the official U.S. unemployment rate now stands at 10.2 percent, as reported by the government last Friday, I'm making this Unemployment Week here at the Ticker.
Each day, I'll unpack a different piece of the nation's sorry unemployment picture. Yesterday, I told you that the U.S. unemployment rate is now higher than Europe's.
Today, I'll take a look at unemployment among the young.
The unemployment rate among all Americans ages 16 to 19 is 27.6 percent, an all-time high, according to the Labor Department's Bureau of Labor Statistics (BLS). That means one in four teenagers who wants a job cannot get one or lost one.
Naturally, unemployment among the young is higher than among adults simply because they're teens and they're rightfully doing other things, like going to school and being kids. The rate is almost never in single digits.
But teens are a key barometer of the economy's health. They account for entry-level, low-pay, part-time jobs that employers cut first and hire back last in an economic crunch. In many ways, they are the canary in the coal mine.
Now, let's break it down by race. Among white teens, the unemployment rate is 25.3 percent, also a historic high.
The BLS keeps data on white teen unemployment back to January 1954, and it's fascinating to scan.
When white teen unemployment rate hit 22.2 percent in July of this year, it set an all-time high, which has just been growing since.
The previous high of 21.5 percent was set in December 1982, which was the middle the worst U.S. recession prior to the current one. It also tells you that was a bleak Christmas: the holidays are a good time for teens to find temp jobs.
For all U.S. teens regardless of color, the all-time low came in May 1953, when it was 6.4 percent. Almost all of that year, and in the two prior years, teen unemployment was in single digits.
The romanticist in me imagines a 1953 America where every soda fountain was fully staffed with white-coat-wearing teenage soda jerks and newspapers couldn't print enough papers for all the news boys lining up to deliver them. Those were the postwar boom years, and it wasn't until 1956 that a recession would hit the U.S.
If you look at the BLS teen unemployment data for black Americans, the news is even worse.
Black teenage unemployment now stands at a staggering 41.3 percent. Think about that. Nearly half of all black teenagers of both sexes cannot find a job or have lost one.
Amazingly, this is not an all-time high. BLS data on black teen goes back only to 1972, but it shows us that the unemployment rate peaked at 52.1 in August 1983, as the nation was mired in recession and, let's face it, plenty of employers who were able to hire a teenager were going to pick a white one over a black one.
The lowest rate for black teen unemployment was 20 percent and it came in April 2000 just before the dot-com crash and subsequent recession. According to the BLS data, since January 1972, it has not dipped below 20 percent.
If you're wondering why I spent more time in this posting talking about a white teen unemployment rate, which is half that of the black teen unemployment rate, it's simply a numbers issue -- there are a lot more white teens out of work than black teens.
The black teen unemployment rate of 41.3 percent translates to 289,000 black teens who are unemployed.
The white teen unemployment rate of 25.3 percent translates to 1.29 million white teens who are unemployed.
Finally, it would be economically irresponsible to write about teen unemployment and not note that most work for the minimum wage. As the federal government continues to raise the minimum wage, it makes it more difficult for small businesses to hire more teenagers.
-- Frank Ahrens
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November 10, 2009; 11:41 AM ET
Categories: The Ticker | Tags: Bureau of Labor Statistics, unemployment
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