After the dismal employment numbers reported by the Labor Department for May, media attention has begun to focus on the summer job shortage for teenagers. According to one AP article published on Wednesday, "Once a rite of passage to adulthood, summer jobs are disappearing" – one of the reasons for this being "adult competition".
A central theme in this discussion has been the job competition from immigrants. Experts are quoted about its severe long-term consequences: lower skills, reduced labor force attachment, and rising inequality.
None of this is wrong, but we need a strong dose of common sense about priorities. Our labor market crisis – now in its fifth year – is centered on the inability of vast numbers of adult workers to find full-time jobs that pay living wages. That there is a major summer jobs shortage for teens is real, but its importance pales next to the costs of the employment problems of prime-age workers. If there is a teen crisis, it has much more to do with academic preparation and college completion than with the availability of summer jobs.
Yes, the job market for teens is likely to be as bad as last summer – we won't know exactly how bad until the June and July numbers appear. But we do know that teen employment rates are at an all-time low. The employment rate for 16-19 year-olds has collapsed since 2000, with similar huge declines in the early and late 2000s (from 45% to 36.2% between 2000 and 2004, and then from 34.3% to 25.5% between 2007 and 2010). Particularly worrisome is the sharp decline for 18-19 year-old black teens: from 31.8% in 2007 to 23% in 2010. If there is any good news in these numbers, it is that between 2010 and 2012, these rates at least didn't get much worse.
And yes, in the worst jobs collapse since the Great Depression, teenagers will face increasing competition from adults, and some of these will be immigrants. But this is nothing new – decades ago, Katherine Newman's brilliant case study of Harlem fast food restaurants showed that black teens faced intense competition from adult immigrants. But in a time of job shortage, should we be blaming foreign-born adult workers for taking bad jobs? For the record, foreign-born workers have also seen massive job losses in recent years: between May 2007 and May 2012, the foreign-born employment rate fell from 65.3% to 61.4%, only slightly less in percentage point terms than the native-born decline, which fell from 62.6 to 58.3%.
And finally, yes, it is also true that teenage employment, both during the school year and over the summer, used to be much more common. But this was a legacy from an earlier time, when most lived in rural areas and teenage children were needed for work on the family farm. In our high-tech service economy, more hours per day and weeks per year need to be spent in the classroom and doing homework.
Indeed, most other rich countries require much longer school days and far shorter summer holidays. In the early 2000s, 26% of American 16-19 year-olds worked while enrolled in school; this figure was just 2% for French teens. Their school days are much longer. And no, the explanation is not that French kids would have been working like their American counterparts if the jobs were there. In fact, back in the 1960s and 1970s when French unemployment was very low, the employment rate of French teens enrolled in school was also about 2%. "Work" for teens should mean schoolwork, not part-time, dead-end jobs paying the minimum wage.
If we're looking for good indicators of the failure to prepare our teens for a lifetime of productive, satisfying and well-paid work, we should look beyond the summer jobs deficit to our abysmal college graduation rates. The share of young people (25-29) with a college degree rose in the 1990s, but has been flat in the 2000s at around 30%. While increasing numbers of young people have sought post-secondary degrees, poor academic preparation, the shortage of decent full-time jobs for recent graduates, and rapidly rising tuition costs have produced astonishingly low graduation rates. Students entering a four-year college in 2003 had a graduation rate of just 55.5% six years later. Even worse, community colleges offering a two-year associate's degree report a three-year graduation rate of just 29.2% for the 2006 entering class.
Unfortunately, there is hardly any payoff to going to college and not finishing. On average, the premium for getting "some college" over a high-school degree was $1.85 per hour in 1998, $2.03 in 2000, and $1.92 in 2007.
Rather than bemoan our summer jobs deficit, we should focus on what can be done to increase academic preparation and college completion, while attending to the labor market problems of prime-age workers. Our limited resources for job creation ought to be focused on the needs of heads-of-households, which would help reduce the economic need for teens to supplement family income. The obvious (though politically unpopular) solution is stimulus spending focused on fixing the country's rapidly collapsing physical infrastructure, together with the revenue needs of states and local governments, whose layoffs have been contributing to the jobs crisis.
And what should be done for teens? Here's a modest proposal. Let's start – in next year's federal budget – by re-allocating the vast bulk of the $20bn we are spending on agricultural subsidies (which is mostly just a big welfare program for rich large farmers and corporations) to support low-income households through expansion of the earned income tax credit, and to support low-income teens via substantial tuition vouchers (not loans!) to increase those college graduation rates. Just half of what we spend on rich farmers would provide 2m $5,000 tuition vouchers.
In this economic crisis, the summer jobs deficit is just a sideshow – even for teens.