Author Topic: Why Are So Many Young Adults Not Looking for Jobs?  (Read 187 times)

0 Members and 1 Guest are viewing this topic.

Offline rangerrebew

  • America defending Veteran
  • TBR Contributor
  • Hero Member
  • *****
  • Posts: 57,465
  • “It’s easier to fool people than to convince them
Why Are So Many Young Adults Not Looking for Jobs?
« on: June 21, 2014, 03:41:27 PM »

Why Are So Many Young Adults Not Looking for Jobs?

 Stephen Moore  / @StephenMoore / June 21, 2014 / 30 comments



Stephen Moore, who formerly wrote on the economy and public policy for The Wall Street Journal, is chief economist at The Heritage Foundation.

Economists are scratching their heads trying to figure out a puzzle in this recovery: Why are young people not working? People retiring at age 60 or even 55 in a weak economy is easy to understand. But at 25?

The percentage of adult Americans who are working or looking for work now stands at 62.8%, a 36-year low and down more than 3 percentage points since late 2007, according to the Labor Department’s May employment report.

This is fairly well-known. What isn’t so well-known is that a major reason for the decline is that fewer and fewer young people are holding jobs. This exit from the workforce by the young is counter to the conventional wisdom or the Obama administration’s official line.

The White House claims the workforce is contracting because more baby boomers are retiring. There’s some truth to that. About 10,000 boomers retire every day of the workweek, so that’s clearly depressing the labor market. Since 2009, 7 million Americans have reached official retirement age. The problem will get worse in the years to come as nearly 80 million boomers hit age 65.

But that trend tells only part of the story. The chart above shows the real problem: The largest decline in workforce participation has been those under 25.

Idle Youth

The percentage of young Americans earning a paycheck or looking for work has fallen by 4 percentage points over the course of the recovery, and those between 16 and 25 have experienced the largest decline.

Those over 65, by the way, are more likely to be working today than five years ago. This shift has cushioned the blow of young people not working.

Why is this trend so troubling? Studies show that teens who start working at a job at a young age have higher earnings later in life. One study found that those who work as teenagers have earnings that are about 10% higher at age 27 than those who did not work.

“When we hold young Americans out of jobs,” explains Michael Saltsman of the Employment Policies Institute, “that makes it more difficult for them to get higher-paying jobs later.”

The federal minimum-wage hikes that started in 2007 didn’t help. Teens were priced out of the job market. The overall teen jobless rate skyrocketed. For black males, it topped 40%.

The teen unemployment rate remains at 19.2% — even with the participation rate down sharply — so it would be hard to imagine a worse time to raise the minimum wage again.

Minimum Wage Impact

Saltsman’s research shows that a 10% rise in the minimum wage could mean a 2% or 3% decline in young Americans working. Seattle is raising its minimum wage to $15 an hour. A $10.10 federal minimum wage is being pushed by the White House. The current minimum wage is $7.25.

“When wages are held artificially high,” says Ohio University economics professor Richard Vedder, “jobs are a lot more scarce. Unemployment is negatively associated with the wage rate.”

High teen unemployment is a big problem in Europe, where wage floors are very high. In nations such as France and Spain, the young delay their entry into the workforce until their mid- or even late 20s. These workers’ wages rarely catch up to those who start working earlier. Europe has traditionally had a much smaller share of young adults in jobs.

“Where have the workers been going in the U.S.?” asks Louis Woodhill, an economist in Houston. “They have been fleeing into the arms of the welfare state.” Since 2007, 2 million more Americans have started receiving Social Security disability payments, and food-stamp rolls have increased by 20 million. This has substituted for jobs.

Student Loans

One possible reason that the young are staying away from the labor force is student loans. Since 2007, student loans have risen by more than $500 billion, a subsidy that may be giving college-age students an incentive to take aid instead of look for work to become financially self-sufficient and acquire marketable skills.

We do no favors to the young by teaching them that they can consume or have a good time without first earning the money they spend. The decline in young workers couldn’t come at a worse time. At the other end of the spectrum, as the 80 million boomers move swiftly out of the workforce in the decade ahead, who will support them? Mick Jagger isn’t going to be playing forever.

http://dailysignal.com/2014/06/21/number-employed-young-americans-drops/
« Last Edit: June 21, 2014, 03:42:29 PM by rangerrebew »
There is danger from all men. The only maxim of a free government ought to be to trust no man living with power to endanger the public liberty.
Public virtue cannot exist in a nation without private, and public virtue is the only foundation of republics. There must be a positive passion for the public good, the public interest, honour, power and glory, established in the minds of the people, or there can be no republican government, nor any real liberty: and this public passion must be superior to all private passions. John Adams

Offline Chieftain

  • AMF, YOYO
  • Hero Member
  • ****
  • Posts: 9,633
  • Your what hurts??
Re: Why Are So Many Young Adults Not Looking for Jobs?
« Reply #1 on: June 21, 2014, 04:20:12 PM »
That's because a large number of young adults engage in a vast underground economy where you can buy and sell drugs for cash and live off the proceeds in relative comfort.  I read an article recently expounding on how many people there are out there who are "un-banked", in that they do not have any kind of checking, savings, or even a debit or credit card.  They live on cash, and any work they do they are paid in cash, or take a check to a check cashing facility and get cash for a fee.

Add in the wide availability of "food stamps" or Electronic Benefit Cards, food banks, and a wide variety of "free" services provided by local County and City Governments (and paid for by local taxpayers), it is no wonder there are so many people who are not looking for an actual job.  Someone recently did a study here locally and showed how panhandling for spare change on a freeway off ramp paid several times the minimum wage, tax free and in hard cash.

And don't get me started on why a 22 year old needs a medical marijuana card that entitles him to constant marijuana use....

Too easy to be sick, lame or lazy any more.....

 :smokin:

Offline speekinout

  • Hero Member
  • ****
  • Posts: 4,337
Re: Why Are So Many Young Adults Not Looking for Jobs?
« Reply #2 on: June 21, 2014, 05:03:20 PM »
The teens are losing a lot by not working early. And so is society losing. It's often those early jobs that give the teens focus on what they want to do in life, and what it takes to prepare for that. They also gain respect for what it takes to earn an honest dollar.
Teens who don't work and borrow (sometimes huge sums) for a pleasant college experience are in for a rude awakening when they have to find out what being self-sufficient really means.
The ones who wake up in their late 20's with a mountain of debt and education that's useless in the job market have poor chances of ever becoming really successful. That's a loss for all of society.

Offline massadvj

  • Editorial Advisor
  • Hero Member
  • *****
  • Posts: 12,066
    • Auktion Online
Re: Why Are So Many Young Adults Not Looking for Jobs?
« Reply #3 on: June 21, 2014, 06:34:18 PM »
That's because a large number of young adults engage in a vast underground economy where you can buy and sell drugs for cash and live off the proceeds in relative comfort.  I read an article recently expounding on how many people there are out there who are "un-banked", in that they do not have any kind of checking, savings, or even a debit or credit card.  They live on cash, and any work they do they are paid in cash, or take a check to a check cashing facility and get cash for a fee.

Add in the wide availability of "food stamps" or Electronic Benefit Cards, food banks, and a wide variety of "free" services provided by local County and City Governments (and paid for by local taxpayers), it is no wonder there are so many people who are not looking for an actual job.  Someone recently did a study here locally and showed how panhandling for spare change on a freeway off ramp paid several times the minimum wage, tax free and in hard cash.

And don't get me started on why a 22 year old needs a medical marijuana card that entitles him to constant marijuana use....

Too easy to be sick, lame or lazy any more.....

 :smokin:

You have it about right.  More and more young people are coming to the conclusion that milking the system for what you can, and getting the rest from the underground economy, is a much more pleasant life than chasing the American Dream.  The sad part is, they may be right.  The system puts so many obstacles before those who try to pull themselves up by their bootstraps that the smart play may well be to just go surfing or live in cyberspace, and let Democrats pay you for voting for them every few years, along with whatever other scams you can come up with. 
"She only coughs when she lies."

Offline jmyrlefuller

  • J. Myrle Fuller
  • Hero Member
  • ****
  • Posts: 11,937
  • ^^ Actual picture of me.
    • Fullervision
Re: Why Are So Many Young Adults Not Looking for Jobs?
« Reply #4 on: June 22, 2014, 07:20:24 AM »
Why?

Well, one, the few career jobs that are out there have such stringent requirements that almost nobody actually qualifies for them, especially at the almost nonexistent anymore "entry level." Companies don't want to train their employees anymore so they demand "internships" where the workers have to work for nothing, a completely unfeasible prospect for those who live more than a few miles away, and even those aren't open to those who have already graduated college in most places. Good luck (you'll need a LOT of it) if your first career never panned out and you want to find a different path without going back to college AGAIN.

The massive push to send as many people to college as possible has created a glut of white-collar workers that turns the job application process into an agonizing lottery. There are a few blue-collar jobs left, but the skills aren't always transferable.
STILL a proud supporter of the Free Conservative Resistance (no affiliation with the left-wing "Resistance")

"Just because people in positions of authority are stupid, it doesn’t mean you have to go along with it." —Arlo Guthrie


Share me

Digg  Facebook  SlashDot  Delicious  Technorati  Twitter  Google  Yahoo
Smf