Teen Unemployment

I came across an article about teens and unemployment, Jacob Passy’s Record low unemployment doesn’t mean teens will find summer jobs. There is nothing particularly insightful about the article, but it got me thinking. It occurred to me that those considered working age has changed immensely over time.

In the past, if you could walk and grasp objects with your hands, you were working age. But then child labor was made illegal. Small family farms also used to informally employ many young people and yet the once common practice of hiring out one’s children as farm labor has also become illegal. For a period of time, new areas of work emerged for youth workers: babysitting, paper routes, fast food restaurants, etc. Even those jobs are disappearing for youth as job scarcity is forcing older workers to take those positions, along with other shifts in laws and the economy.

“Overall, far fewer teens are looking for work these days. The labor-force participation rate, a measure of the share of people with jobs or looking for employment, was 35% for teens last July. Comparatively in 2000, when the U.S. economy last came close to achieving full employment, the labor-force participation rate for this group was nearly 53%. […]

“Fewer teens are able to find the types of jobs that were once popular with teen workers. In the late 1990s, one in four food service workers during the summer was a teenager, now that figure is just one in six. Similarly, in 2000 a fifth of retail workers handling sales and customer service in the summer months were teens. These days, that share has dropped to one-seventh of all retail workers.

“Many of the lower-paying jobs in the retail and hospitality sectors that used to be filled by teenagers are now held by foreign-born adults and older workers, including those past retirement age, according to the report from Drexel.”

This has broader implications. As they are not making money, teens aren’t contributing to family income and so are increasingly dependent on parental income. For some families, this would be a decrease in family income. For others, parents would make up the difference by working longer hours. But the latter couldn’t be possible for most, since about half of the working age population is either unemployed or underemployed.

Competition for work is going to get worse over time. Older workers will increasingly dominate employment. This is a trend that has been developing for more than a century. Universal public education intentionally pulled children out of the job market. Increase of school homework and extracurriculars needed to get into college have eliminated much of the free time that teenagers used to work jobs. And increasing college participation is further delaying entry into the workforce.

All of this is putting ever greater pressure on parents as providers. The age of perceived adulthood is being raised. This artificially lowers unemployment. For those who haven’t yet joined the workforce, they aren’t labeled and counted as unemployed. It’s similar to eliminating from unemployment rates people who have given up on looking for a job. It is deceiving to speak of unemployment among job seekers when ever larger numbers for one reason or another are being excluded from the category of job seekers.

Unemployment rates seems like an endless game of number manipulation.

* * *

I showed the article to my father. Here is his response:

“Yep. And in Iowa, kids cannot work until 14, and for the next two years, they cannot work past 7 pm on week days nor over 4 hours, if I recall correctly. So given the need for shift flexibility as people are sick or unexpectedly quit, employers don’t hire them as readily as older employees. Or so the family owner of a drive in place told me. Maybe 16 is the magic age.

“So I guess we don’t encourage them. And there is always a “good” reason for laws that discourage them while the real reasons remain unstated. My brother and I started regular part time work at age 15, and daily paper routes at age 11.”

Like my father, I also started working young. I had a paper route in elementary school that I did before school each morning. I did yard work for neighbors in middle school and high school. It was in 11th grade that I got a job at McDonald’s. It was common for kids and teens to work in the past. I never thought anything about it, as many of my friends had been working since they were kids.

So, if discouraging the young from working is intentional, what is the real reason? Some argue that it’s because education has become treated as work, in being ever more prioritized. And it’s a fact that kids do more homework now and are more likely to get more education. A few generations back, most people didn’t even graduate from high school and so beginning work young was a necessity. But how long can adulthood be delayed and for what purpose.

Maybe we are slowly transitioning toward something like a basic income. It is true that basic income experiments show that, when given a basic income, students are less likely to work while in school and that probably would be a good thing. I wonder, though. Americans are obsessed with the moral value of work as a way of proving your social worth. Plus, work has become a form of social control to keep the masses preoccupied. Older people are working longer and retiring later. And with the phenomenon of increasing bullshit jobs, the disappearance of jobs through automation is far from inevitability.

This past century’s shift has to end at some point. It can’t keep going like this while maintaining the kind of economy we’ve had.

5 thoughts on “Teen Unemployment

    • Obviously, something is being left out of that article. In a functioning free market, if an employer is offering good enough wages and benefits based on the local market and demands, and if there is a large enough workforce with appropriate skills or could be trained for those skills (a workforce that is local or that can be brought in from elsewhere), then job openings will be filled.

      To put it over-simplify, one commenter put it succinctly in saying, “Pay them more, and they will come.” Or as another said with more words, “Is the US a market economy or not? Then what are these people whining about? If a resource gets scarcer you have to pay more or change your business.” That is basically true, even ignoring the fact that the US doesn’t actually have a fully functioning free market. The problem is that employers aren’t guaranteeing income and benefits that keeps up with the rising inflation and rising costs of living: transportation, housing, healthcare, childcare, education, etc. An unforgiving commenter put it harshly: “if your business model depends on paying people less than it costs to survive, your business model is theft.”

      On top of that, there are even greater pressures on the younger potential workers. Education has come to so fully preoccupy student’s time and energy that there is little left over for work. Kids have more homework, are involved in more extracurriculars, and are more likely to take summer courses to get an edge or prepare for college. That is the thing with college becoming ever more important because a college degree has become equivalent requirement for good employment as once was a high school degree. And minimum wage manual labor work is not going to either prepare a student for college or help pay for it.

      There is another factor that relates to the above and is touched upon in the article. The service industry has become dependent on cheap labor. There are two main sources of cheap labor, the young and immigrants. As I (and my dad) pointed out, there have been increasing laws eliminating child labor and regulations limiting teen labor. Even if that wasn’t the case, this source of labor has not kept up with market demand.

      GenX was small generation, but that was made up with increased immigration, both documented and undocumented. That latter solution was no longer workable in the early 2000s when undocumented immigration in particular slowed down, not that right-wingers noticed. Also, Obama had a major crackdown on undocumented immigration in deporting more immigrants than any other president in US history, a minor detail that doesn’t fit into the mainstream narrative of either party. This is a big deal because the US economy has always been dependent on cheap, undocumented labor. That is problematic itself, specifically in terms of claiming to be a free market. Cheap undocumented labor simply drives down wages and so many businesses were built on the assumption that they should have privileged access to such low wage labor. But that has created a lot of crappy job that most Americans can’t afford to work, as one person explained it:

      “No one wants part time work with constantly changing shift times and caps at 29 hours to avoid benefits. Remember, it was President Trump who reversed the Obama law that made companies pay workers who earned less than $44K overtime. Fast food has nickel and dimed everyone for decades and no one but an undocumented person will take these jobs anymore and in a tight labor market – even they don’t want these jobs either.”

      Someone had an even more damning criticism directed at the fast food industry:

      “Another observation from my temporary life here in Michigan: like so many other “Anywhere America” towns, the landscape is full-to-exploding with fast food restaurants. As you pass through towns it’s a never-ending string of McDonalds, Arbys, Burger King, KFC’s and on and on and on. You can literally pull off the road every 100 feet and find somewhere to eat. One might think that all Americans do is shop and eat at these mini-filth-factories. It’s no wonder there aren’t enough workers.

      “There was a time when “fast-food” meant that food was involved. Face it, restaurants are the lowest-common-denominator types of businesses. The owners are out to make a quick buck off the backs of low-paid workers. They offer low wages, few benefits and lousy work schedules. And, for the record, anyone who believes that young people learn good job skills by working in these places are fooling themselves.”

      And here is a commenter sincerely expressing the notion that there are other ways to run an economy, specifically in terms of food-related businesses:

      “Great news! Maybe it means an end to the plague that is killing America: fast food. If the owners of those places like MacDonald’s and Dunkin Donuts that are selling food-like products will be forced to raise prices, perhaps they will be struck with a novel idea: how about selling REAL food and charging more? I just came back from Italy and Israel where every street is lined with eateries – not chains but actual, individually owned restaurants, some very grand, some a hole-in-the-wall, serving yummy dishes that an average American doesn’t even know exist. And waiters in these places are either moonlighting college students or immigrants. I had a nice discussion of the situation in the Middle East with a waiter in Tel Aviv who brought me my sania (look it up!) and who is doing his degree in international relations. Are these places more expensive than a MacDonald’s? Of course. But Italy and Israel don’t have the terrifying obesity rates of the US, so perhaps there is something to be said for paying more, eating less and getting better quality food.”

      Or if you prefer a more sarcastic commenting style:

      “Great news! We should all thank Trump for the positive development. Finally, labor market is not distorted by cheap immigrants. Finally, market force will force innovations. In order to survive, business must be creative. Automation will be introduced to cut labor cost. I am very excited. To make America great again, we must bring the can-do spirit back. Cheap immigrants are bad to this country. The old business model was not sustainable. We cannot continuously bring in more immigrants. The easy and cheap ways of doing business are over. BTW, liberals should celebrate this development too. Finally, they will get their wage increase. Liberals, environmentalists, KKK are all celebrating. Wow! It is too good and it is true!”

      But I’ll end with a comment that points out that the source of the problem is largely to be found within the franchise model itself:

      “Franchise sellers have been screwing over the people who buy their franchises for decades. Look into that business model, the only franchise buyers that have a hope of making money have to own many, many outlets, probably have to try to make ‘special’ deals with the franchise., and hope like h*ll that the franchise does not change the rules on them, despite their large investment.

      “Mr. Kaplow? You are doing what generations of small store owners have done. You work in your own store because you cannot afford to hire help.

      “This is a new American tradition that differs from the old one where one person or family were responsible for their own business. That tradition went back through generations of immigrants, and most managed some sort of living and some did very well. There is a new brand of kool-aide being sold now. Subway, Starbucks, McDonald’s, Wend’y, Super 8, etc. do not care about you. If you fail to deliver the margin they want, you will be shut down, as I am sure that you are finding out to your chagrin.

      “I hope you are not too surprised now that the promise of riches has proved to be illusory. It has for many, join the crowd.

      “Best wishes, and I really mean it. The system you are struggling with was not designed to help you, it was designed to deceive you. If you can manage it, get out, rethink your skills, and if you decide to set up your own little place, be prepared to work very hard, and you will have the reward to not being beholden to anyone.”

    • One thing entirely left out of the article is automation. In some countries, businesses like fast food restaurants have been in the process of being automated for years. The only reason this hasn’t happened as quickly in the US is because of artificially suppressed wages and surplus labor, related to undocumented immigrants and union busting. But I did notice that a McDonald’s near my house has now been largely automated.

      • I am impressed by the Nordic countries. Other than some experiments, they haven’t implemented any universal basic income program. But they are otherwise extremely progressive. Iceland re-trains workers when they become unemployed. Also, some of those countries offer free education so that students don’t have to work while in school.

        This is why it was no big deal for automation to take over low wage work. They simply shifted their entire economies to ensure workers had good quality work and that no one lacked basic needs such as healthcare. These countries are able to accomplish this while being no where near as wealthy nor having near the level of vast natural resources as the United States.

        We Americans seem to lack not only insight and imagination but also lack practical-minded determination to solve basic problems. As Winston Churchill once said, “You can always count on Americans to do the right thing — after they’ve tried everything else.” Apparently, we’re still in the middle of trying everything else. Let’s hope we soon get on to the next step.

    • Biz Griz
      GangtokMay 4
      Here’s the tiniest violin in the world playing just for the fast food restaurant owners. When times are tough the business people always say, oh the market dictates your wages and sorry the market says you get nothing. When times are good all they do is complain about not having enough low paid staff. Guess what, the market now dictates that YOU pay more. More than you are currently paying apparently.

      Nate
      LondonMay 4
      Pay more and provide benefits and you wont’t have this problem. If demand is outstripping supply, economic theory says raise prices anyhow.

      bill
      marylandMay 4
      Many comments here seem to think that the problem is kids today just are too lazy or entitled to want to work. The fact is these jobs offer little in exchange for today extremely busy kids.They offer not only poor wages but also little or no resume value. The real problem is with an industry predicated on a business model that requires paying people so little that even working
      40 hours a week puts you under the poverty line. So they are dependent on finding workers who do not need the money to live.

      Two in Memphis
      MemphisMay 4
      It’s really funny that the “lazy millennial’s” get all the blame.
      It looks like “Fast food” has a serious problem, an aged business model which relies on starving wages in a really bad work environment. I was wondering why I don’t like to go to Subways anymore. The answer is right here.
      Maybe these chains just have to go away. At least Subway is already working on it. They are closing hundreds of stores.

      mark
      paMay 4
      As a free market advocate, the answer to this problem couldn’t be more clear. Instead of offering tiny bonuses and non-financial incentives, owners will need to reach into their pockets. I had lunch yesterday at McDonalds for $3.69. I have seen the luxurious homes and vacation homes of the owners. There is plenty of room both in pricing and in the current profit margin to raise wages. Workers are their own problem since there is always some willing to work for inadequate wages. If everyone walked out at once, they would all be hired back with a 50% raise. That’s Adam Smith’s invisible hand at work as he intended.

      greppers
      upstate NYMay 4
      Can’t find workers at the wages you want to pay? Pay more. It’s the way the labor market works. Employers got fat and happy after the latest recession when they were able to pay minimal rates and still had more applicants than they needed.
      Nobody owes you a living wage was their refrain. You want more money get another job, get training, work two jobs, get some bootstraps.
      Now the bootstraps are on the other boot. Nobody owes you a profit.Nobody is obligated to work for you at sub-par wages just so you can be a successful business owner. Get another business, work harder, get two businesses. The free ride is over.

      Robert Goldschmidt
      Sarasota FLMay 4
      There may be fast food jobs, but they don’t pay enough for an employee to live The American Dream — housing, food, transportation, health, education and retirement. That is why these jobs are the breeding ground for our loss of faith in our political/economic system and our growing susceptibility to hate speech and demagoguery.
      Fast food jobs are no longer occupied by teenagers as this article implies, but by 35-yr old members of the working poor.
      Also, the unemployment rate has accumulated so many fudge factors that it has become meaningless. For example, the labor participation rate for males 25-54 demonstrates that over 10% of these most-likely-to-work individuals are not working.

      bnc
      Lowell, MAMay 4
      The franchise food industry is a pyramid scheme that thrives on promising huge profits for its franchisees. It also takes huge profits in fees that make huge profits for the corporate elite. Dastardly greedy policies have been revealed, including intentional time card fraud that refuses to pay overtime and over-working “managers” who are compensated at effective hourly rates far below the legal minimum wages. Franchisees are restricted by being forced to procure their food and supplies from corporate sources at prices far exceeding what can be obtained in the “open market”.

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