Generation Opportunity, a national, non-partisan organization advocating for economic opportunity for young people, released data that showed that for the fourth consecutive month youth unemployment has remained at 15.9%.
The study examines unemployment among the age group 18-29 and accounts for race, gender, ethnicity and adjusts for labor force participation. The data is non-seasonally adjusted (NSA). The extremely high unemployment reflects poorly on the economy’s ability to utilize the growing population of millennials that are entering the labor force.
Evan Feinberg, President of Generation Opportunity, offered this statement:
The unacceptably high youth unemployment rate is troubling because we are the most creative, innovative generation in American history. We are developing new technologies, saving lives, and making this country better. The only thing holding us back is the constraint of government. The real shame is there are easy policy solutions that would free our generation to realize our potential. We need to stop spending our economy into a tailspin and eliminate red-tape and other barriers to work.
Moreover, with the prospect of the minimum wage going up in many states, the likelihood of unemployment for youth will continue to increase. Many economists, including Thomas Sowell, senior fellow at the Hoover Institute in Stanford, CA, contends that as minimum wage rises, so do labor costs, creating an impetus for companies to reduce employees. Maybe most disturbing about the findings is that just under one-in-four African Americans ages 18-28 years old are unemployed when adjusting for labor force participation. Labor force participation-weighted statistics include those who are no longer looking for a job, but are still unemployed.
Below are the findings as of December 2013:
The effective (U-6) unemployment rate for 18-29-year-olds, which adjusts for labor force participation by including those who have given up looking for work, is 15.9 percent (NSA). The (U-3) unemployment rate for 18-29-year-olds is 9.5 percent (NSA).
The declining labor force participation rate has created an additional 1.880 million young adults who are not counted as “unemployed” by the U.S. Department of Labor because they are not in the labor force, meaning that those young people have given up looking for work due to the lack of jobs.
The effective (U-6) unemployment rate for 18-29-year-old African-Americans is 24.2 percent (NSA); the (U-3) unemployment rate is 16.7 percent (NSA).
The effective (U-6) unemployment rate for 18-29-year-old Hispanics is 16.8 percent (NSA); the (U-3) unemployment rate is 10.5 percent (NSA).
The effective (U-6) unemployment rate for 18-29-year-old women is 13.7 percent(NSA); the (U-3) unemployment rate is 8.5 percent (NSA).