No Entry: Why Is Teen Unemployment So High?

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The woman sweeping floors at the McDonald’s on 204th Street had gray hair tracing her temples, and her colleague at the register looked to be at least 50. Down at the Micky-Ds on Fordham Road, the woman making french fries could have been a grandmother, and she was not the oldest one behind the counter. At the restaurant on East 170th, the employee on break had a wrinkled face; those on duty were younger, but few could pass for 30. The man taking orders on East 167th Street looked to be pushing 50. On Jerome Avenue, the entire staff—at the registers and the grill—seemed to be beyond their 20s.

If there’s a typical teenage job in America, its pushing Happy Meals and Big Macs under the golden arches. But an unscientific survey of McDonald’s in the Bronx late one May afternoon found very few teens pulling milk shakes or slathering special sauce onto sesame seed buns. And while McDonald’s is not the only place where a teenager can work, statistics indicate that, wherever they look, America’s teens are having as hard a time finding work as they ever have. The national unemployment rate for people aged 16 to 24 hit 19.6 percent in April—the highest ever. For the younger subset of 16-to-19-year-olds, the rate was 25.4 percent; for the past year, unemployment rates for this group have been higher than ever before. Some parts of the teenage population are faring especially poorly. Black females posted a 39 percent rate of unemployment. The rates for black males and Latino males have fallen from their late-2010 highs of 57 percent and 41 percent, respectively, but only because roughly 197,000 black and Latino teenagers simply dropped out of the labor market.

“It’s shocking just how many teens are spending half a year or more looking for work,” says Mike Saltsman, a research associate at the Employment Policies Institute. “There is no question that the recession has worsened employment prospects for teens. Those numbers are certainly unprecedented.”

Timing is everything, and for people trying to enter the workforce now, their timing is awful. “This cohort that is coming out now sort of picked the worst possible time to become a new entrant to the labor market,” says Heidi Shierholz, an economist at the Economic Policy Institute. “Young workers have been hit disproportionately hard, as they always are,” she adds.

The reason is obvious: When the economy tanks and older workers lose their jobs, the labor market is flooded with more experienced candidates, who compete—and often win—against teens for remaining jobs. If she were an employer with a job to offer, Shierholz explains, “I’m going to take the most experienced worker who will take it.” She adds, “A very elevated unemployment rate means workers don’t have a lot of power.”

This competition is playing out in the streets and drive-through lanes of New York. “People who are unemployed but older apply for the same jobs [teens] were used to getting—the McDonald’s, the Burger Kings, even some of the retail jobs,” says Oma Holloway, the career services director at The Door, a Lower Manhattan nonprofit that serves youth.

Older workers not only have more experience; they are more likely to have educational credentials that give them a leg up over teens. People with master’s degrees, for instance, are doing Census jobs this summer. For teens whose paths to a diploma have detoured, the disadvantage is magnified. “When I was doing my job search before, it was the older people who were getting the supermarket jobs,” says Tykeisha Youmans, a 19-year-old client of The Door who dropped out of high school. “Before I got my GED, I wasn’t getting hired anymore: Target, Home Depot, Kmart, all these places.”

Some analysts see more than just a cyclical downturn at play. Opponents of the minimum wage, who have long argued that it depresses employment, say the rise in the federal hourly minimum from $5.85 in 2007 to $7.25 in 2009 priced teenagers out of work.

A recent study by the Center for Business and Economic Research at Ball State University estimated that 310,000 teenage jobs were lost by the government’s lifting the wage floor during a recession. “We’re unfortunately making these jobs more difficult to come by, and we’re at risk of creating this lost generation of teens that are lacking that first job experience,” says Saltsman. “Maybe [teens] are willing to take that job paying five or six bucks an hour. And maybe there’s a boss who’s willing to take a chance on them,” he says. But, Saltsman argues, at $7.25—or higher, as the minimum wage is in 14 states—all bets are off. “When you set it that high, people who don’t have any skills or were disadvantaged earlier in life have that much more of a hurdle.”

The minimum wage was raised in 2007 to restore some of the buying power it had lost over decades, as inflation made consumer goods costlier. Shierholz rejects the idea that the wage is to blame for teen travails in the workplace. Today’s high teen unemployment, she says, reflects the problems in the larger labor market. What’s more, she says, “A higher minimum wage actually creates more jobs,” by putting more money in the hands of people likely to spend most of it, stimulating the economy. Whatever the impact of the minimum wage, it’s probably small: Only about 1 percent of workers aged 16 to 24 earn the federal minimum. (The pool would be somewhat larger if it included people earning state minimum wages that are higher than the feds’, but that number is hard to specify.) But neither economic downturns nor wage increases operate in isolation. Technological changes have also altered the opportunities open to young workers. At supermarkets with self-checkout lanes, for instance, one worker can supervise several lanes, doing what three or four cashiers used to. So teens hoping to break in to the supermarket game face competition not just from older workers, but from computers as well.

For many teens in New York, the jobs they aren’t getting nowadays weren’t just going to be for pocket money. “We have a number of young people who live in shelters, who have vouchers or have the possibility to find housing. [Joblessness] can hold up the possibility of finding a place, because they don’t have employment,” says Holloway. Some receive welfare or food stamps and need to show they are working. “If they live at home, they are contributing to their household. Their parents are unemployed or facing having to do off-the-books jobs.”

“Unfortunately for a lot of these young people, it’s not saving up for college. It’s how do you live and survive day to day?” she says. And for both those attending college and those skipping it, getting jobs in the late teen years creates the work record that fills out a résumé for that better gig down the road. Demonstrating work readiness, developing good references, networking: All that is hard to do from the outside looking in.

All those pressures mean that despite the uninviting labor market, teens are actually more intent on working now than they were a few years ago. The Door runs a program called EPOCH that helps clients get their GED and a job. “Before, a lot of young people were more interested in getting their GED, were willing to take their time. They didn’t as much feel this sense of urgency to get a job,” says Holloway. “But you’re finding a lot more that what young people immediately want is employment. We’ve had to shift more, on young people who come into the GED program, to making sure they’re ready for a job.”

But that’s more challenging now. Because of the competition for work, young job applicants are more likely to face drug tests, background checks and multiple interviews, Holloway says. For those who can’t find anything paid, The Door tries to find programs or internships “where they might earn a small stipend so they can see some of the possibilities and another way to market themselves to find employment,” Holloway adds.

The teen jobs picture will get better, Shierholz says, only when the economy does. “The primary thing that we need to do now is get recovery in the larger labor market. We can talk about smaller programs we can implement. But those things can work around the edge,” she says. The American economy is adding jobs, but at the current pace of growth, it’ll take five years to get unemployment back down to its pre-recession level. “We will just have an enormous swath of young people who are facing entering a labor market when it is really weak.”

One of the government programs that has helped over the years—even if it’s been, as Sheirholz puts it, “around the edge”—is the Summer Youth Employment Program, which in New York City last year provided seven weeks of minimum wage work to 52,000 people aged 14 to 24 at 8,700 worksites around the city. It’s a critical effort to crack open the door between urban youth and the job market. And this year, it’s going to be sliced by more than half. In his proposed fiscal 2011 budget, Gov. David Paterson eliminated funding for SYEP, citing “a rising public assistance caseload” and the need to use federal welfare funds, which had been directed to SYEP, to pay benefits instead. The state cut would cost the city about $20 million. At City Hall, the Bloomberg administration had threatened a smaller, but nonetheless unhelpful, cut, but in the most recent budget the mayor actually restored the $1 million he originally cut and added some $10 million more to the program.

“We are projecting a total of 25,000 slots,” says Department of Youth and Community Development Commissioner Jeanne Mulgrav. “We are anxiously awaiting good news from the state, but we have heard that the governor’s office is not supportive of this. We do know there is support from the legislature to have resources available for young people.” The delay in the state budget means that even if funds are restored, it could be hard to ramp the program up if Albany waits too late to deliver the good news; SYEP is supposed to run from early July to mid-August. “I have never been known to turn away any resources. I know that I can put money to use if it comes in our direction,” Mulgrav says, but adds: “The earlier we get these resources, the more impact it has on meaningful and relevant workplaces.”

Last year’s city youth employment program was the biggest in memory. But even it couldn’t keep up with need: DYCD received 140,000 applications for those 52,000 slots. is year, neighborhood-based contractors who run the program for DYCD are bracing for having to tell even more teens, “No.”

“Last year we had almost 3,000 kids working,” says Bob Altman, who directs SYEP at the Mosholu Montefiore Community Center in the Norwood section of the Bronx. “This year they gave me 420 slots. So as you can see, there’s going to be a reduction,” he deadpans. For last year’s slots, Altman had 8,800 applicants. At press time in 2010, the number of applicants was at 5,500 with the deadline a week away.

“These are good kids,” Altman says. “There’s just not enough opportunity for them. They really want to work.” MMCC placed SYEP participants at a summer camp, lawyers’ and doctors’ offices, a Hebrew Home for the aged, the Bronx Zoo and Lincoln Hospital. “They get paid every two weeks. They feel good about themselves. And they learn. If the kids do well, some of the places, they hire them. We try to teach them about the value of work. Being on time. Pants down to your bottom? No.” The kids spend the money they earn locally; it’s a win-win, Altman says. Those who don’t get SYEP slots typically don’t get anything else. “They hang out. They can’t get jobs.”

Iliyasu Kenchi, a 19-year-old in East New York, is headed to an overnight camp in White Plains for his summer job. He’s been working since he and his brother did odd jobs at a farmers market when he was 14. He did SYEP two summers ago. A high school graduate pursuing an associates degree at City Tech, Kenchi’s last job was as a snow laborer for the sanitation department. He says he wants a job, “like right now, right now. Instead of waiting until June.” “Any type of job,” he says. “They just don’t call you back.”