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Brooks Wilson's Economics Blog: Summer Job Market for Teens

Wednesday, June 9, 2010

Summer Job Market for Teens

(HT Drudge Report)  Joseph Pisani, a CNBC news associate, reports that the job outlook for teens (16-19 year-olds) is bad, the worst in 41 years ("Teens Face Worst Summer Job Market in 41 Years"). 
Employment among 16-to 19-year olds in May grew by just 6,000, the smallest increase since 1969, when teen jobs fell by 14,000, according to government data analyzed by employment firm Challenger, Gray & Christmas. In May 2008 and 2009, teen employment grew by over 110,000.
Given that the unemployment rate for the economy is 9.7%, it is not surprising that the market for low skilled workers is bad as well.  The problems with employment are so severe that college grads and other employees who are normally work at jobs one or two rungs above the skills needed for these entry level low-skill jobs are being pushed down the skill ladder and taking jobs from teens. 

Jobs traditionally given to teens are apparently going to older workers who are willing to take low paying job to make ends meet. Employment among 20- to 24-year-olds grew by 270,000 in May, an unusual spike, considering that employment in the same age group fell by 261,000 in May 2009.

"Also impacting the job market for young adults are the large number of older adults who are willing to accept even a temporary, seasonal position simply to generate some income," said Steven Rothberg, chief executive officer of, an online entry-level job-posting site.

"We're seeing experienced candidates taking jobs normally reserved for college grads and college grads taking jobs normally reserved for college students," said Rothberg.
The poor state of the economy is the major explanation for high unemployment, but the ill timed increase in the minimum wage may also explain part of the increase.  The minimum wage is a price floor.  Employers may pay more but not less than the minimum.  It is binding if it forces employers to pay a wage above the equilibrium wage in their market.  Under this circumstances, the supply of low skilled jobs falls while the demand for employment rises.  Beginning in the summer of 2007, the minimum wage by legislative mandate increased $.70 per hour for three consecutive years.  The teenage unemployment rate began at 15.9% in May 2007, and increased every year thereafter reaching 26.4% this May.   


  1. This is sad due to the fact for those of us going to college, trying to finish or just starting have to wonder will the education that we are receiving going to give us an advantage. This means that those of us with an education will now have to work harder to find the better paying jobs.

  2. Mrs. Morales
    On the teen issue, the older people should think of them taking these kids jobs are putting more and more of them on the streets, and push them to do more illegal things that get them into trouble because of them not being given a chance to get a job. To these young teens getting a job means a lot to them, makes them feel more dependent within them selves. As for us college students, yes we go to college, but everyone need a job to earn a living. Then again it's just hard in general to seek employment now days. Regardless of who or what is taking our jobs, I know that it don't seem fair which it's not, but life is not fair for a lot of us. Our economy is about "quality not quality." Which before i always thought business was the other way around. These businesses are wasting more money on products, then getting the job done right. Paying out more money to employees with out an education and experience,they think they are saving money by paying them less then what they would pay us who went to college for a certain degree.That's why our economy is where it is today.

  3. Suzanne Stricker19/6/10 4:21 PM

    The price floor placed on wages has obviously had a huge impact on teenage unemployment. If the price floor were not in place there would be a larger quantity of jobs available. A wage should be determined by the natural fluctuations of supply and demand. If someone wants to earn a higher wage they should earn a college degree and work at a job where the employee deserves a higher wage. Someone's wage should reflect their long-term efforts and commitments. You may have to work at a low paying job temporarily while you earn a degree that,once attained, will yield a higher wage. And I know that different people have different situations and one might argue that not everyone can get a college degree. But that is just not true. There are thousands of government grants and work-study programs for the underprivileged and every college will have tutors if you have trouble with your grades. Everything boils down to how much you want something and how willing you are to work hard for it. Attitude is more important than aptitute. The minimum wage is unnecessary. At the moment the good of the few is being valued above the good of the many. It is better for 2 people (of equal work ethics and capabilities) to each have half of a candy bar than for one person to not have any so that the other can have the entire candy bar. The task of achieving complete economic recovery from a recession is one that puzzles even the most experienced economists. However, what I have learned so far in this class leads me to believe that the economy would be much better off if it were allowed to achieve and maintain equilibrium without interference from the government. Then again, is there a point where economic recovery becomes so difficult that the upsides of government regulation outweigh the downsides? I'm sure that question could illicit a wide range of responses depending on who the audience was...

  4. The price floor is killing the job market for unskilled workers. As a college student I depend on money I earn in the summer, and to see that some teens might not be able to get a job is sad. The recession has hurt the economy and it is clear now that older members of our society are willing to take on these less skilled jobs. If the minimum wage was lowered it could force the job market to be more at an equilibrium to open up more jobs.