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Youth Joblessness at Nearly 20 Percent

Youth Joblessness at Nearly 20 Percent

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Todays Contributor is Mikhail Zinshteyn . Mikhail is a staff writer for Campus Progress. You can e-mail him at mzinshteyn@googlemail.com.

As the class of 2011 nears graduation, the usual stress points of Latin honors and remaining credits are taking a backseat to a more dire problem. In an economy where roughly 11 million people are looking for jobs, and the average unemployment spell is nine months, one cohort has been hit particularly hard: young workers.

A new report from the left-leaning Economic Policy Institute that analyzes 2010 labor dynamics shows workers between the ages of 16 and 24 suffer unemployment numbers that are more than double the national average. Some of the most striking numbers include: 16- to 24-year-old workers averaged 18.4 percent, compared with 9.6 percent for the general U.S. population; high school graduates not in college and under age 25 were at 22.5 percent, compared to an unemployment rate of 9.3 percent for similarly-aged college graduates; meanwhile, older college graduates are far more likely to hold down employment than graduates under age 25, with unemployment figures of 4.7 percent.

Factor in race and the numbers get even bleaker. The study shows the unemployment rate for black high school graduates under age 25 and not in college was 31.8 percent; Hispanics with the same education attainment level were at 22.8 percent while white high school graduates faired slightly better with an unemployment level of 20.3 percent.

The rate of youth joblessness is at its highest ever since the numbers were first recorded in 1948.

The writers of the study, Heidi Shierholz and Kathryn Anne Edwards, attribute part of the high rates of joblessness to a difficulty in holding down employment, something called “churning,” where, they say, “these young workers are less likely to be tied for extended periods of time to employers, jobs, careers, or even cities. Second, its members have less experience and are often looking for their first or second job.”

Compounding matters is the persistence of high unemployment among graduates who have entered the job market since late 2008. The report indicates a backlog of un- or underemployed graduates from the past two years that leaves the current graduating class at a significant disadvantage: “In fact, it is likely that the class of 2011 will face the highest unemployment ate for young college graduates since the Great Recession began.”

Some students eager to avoid the hard slog of ritualized resume-pushing and menial jobs that don’t equal their education have come up with their own solutions.

Rachael Mitchell, a journalism student and senior at the University of Oregon in Eugene, is one of the fortunate few to have secured a job before graduating. She will begin a teaching career through Teach For America in the fall. “I was definitely compelled to start my job search early because of how limited the job market is right now. The fact that that you can apply so early with TFA was a really big draw,” says Mitchell. “I knew if I got in I would have something secured before every one else graduating from my class.”

Mitchell says many of her classmates began looking in early January for internships and entry-level positions, months after she first submitted her TFA application. “The people I know who started applying for jobs six or more months ago have been largely unsuccessful as well; the only people who have found jobs are people who did internships or got work experience in their field before graduating.”

But TFA’s admission rate rivals most Ivy League schools; the organization announced in 2010 it hired 4,500 new teachers among 46,000 applicants—a 12 percent acceptance rate. The cutthroat process is coupled by a growing number of the talent pool coming from elite institutions: applicants included 12 percent of Ivy League students in their final year, 7 percent of the graduating class of University of Michigan—Ann Harbor, and 6 percent of the graduating class at University of California—Berkeley.

Meanwhile, as companies cautiously begin rehiring, their recruiting managers are foregoing small schools in favor of large state universities. A Wall Street Journal article in September of 2010 explains a culture of cost cutting places top public school students at an advantage. Results from a survey asking companies to select their favorite sources of recruitment confirm much of the same. From the WSJ piece:

  Steve Canale, head of General Electric Co.‘s recruiting efforts, said it is critical for prospective students to ask which companies recruit on campus before deciding where to matriculate. GE, for example, focuses on about 40 key schools—many of them state schools—to hire 2,200 summer interns; upwards of 80 percent of its new-graduate hires come from its internship pool, said Mr. Canale.

Nor are students frustrated by low job prospects flocking to higher learning programs, the EPI study found: “the increase in the enrollment rate in 2008 (+0.5 percentage points), 2009 (+0.9), and 2010 (+1.0) is not a dramatic departure from the 0.7 annual percentage-point increase that enrollment has maintained since 1985.”

And with a political climate bent on deficit reduction measures, the shot in the arm the labor market needs—extra stimulus—is not being seriously considered in Washington.

Heidi Shierholz, one of the authors of the briefing paper, says while local and state authorities are cash strapped, the federal government can step in with relief. “The best thing we can do is to generate a faster a recovery in the overall labor market that will move the dial for [graduates] and unemployed workers in general,” says Shierholz. “There is a clear lever we can push to make that happen but decisions are being made [by Congress] based on items outside of economics.”

Holding back the economy is not a lack of credit to businesses but a lack of demand to encourage businesses to rehire. Shierholz stresses layoffs are now below pre-recession levels, yet with consumer spending not at levels hiring managers feel comfortable with, the urgency to add people to payroll is missing.

Additional stimulus can offer relief to states with agencies significantly understaffed; new jobs in infrastructure and public works will increase aggregate demand, raising demand for value-added businesses college graduates hope to join.

In the meantime, Shierholz wants to remind job seekers their inability to find work is not an indictment on their academic performance or set of skills. “The jobs aren’t there. I think there is this promise that young workers who search hard will be rewarded; it won’t be like that for many of them,” she says.

Recourse for graduates during periods of unemployment is hard to find. Social safety net programs like Temporary Assistance for Needy Families (TANF) have work requirements and require the recipient to be the caretaker of a child. Food stamps are available for graduates who aren’t parents, but only for three months within a 36-month period. However, The Patient Protection and Affordable Care Act enacted in 2010 will roll in Medicaid eligibility rules in 2014 that allow any individual to apply for the program if their income falls below 133 percent of the poverty line.

For the many students about to graduate, these are unwelcoming times. Students not graduating can take some cues from Rachael Mitchell. She suggests building “leadership experience because it proves self-motivation…something really impressive to employers because most of them have this view that all college students do in college is party.”

All is fair in love and war, though Congress is showing little love to the millions of unemployed, and unfairly declaring war on institutions that keep those same people treading above water. For graduates, their solace might come in knowing the source of that old adage.