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The Labor Market Fate of Massachusetts Teens: An Update

     An understanding of the labor market experiences and problems of key demographic subgroups of a state is essential for effective workforce development, policymaking, and program planning. Over the past few years, the Center for Labor Market Studies has documented carefully and in great detail the labor market difficulties of our state’s teens both overall as well as among high school students and high school dropouts. Among both groups,  youth from low income and race-ethnic minorities have fared the worst. Very similar developments have taken place across the country, with teen employment rates at close to record lows last year and this year.

     Here in Massachusetts, the overall teen employment rate has declined dramatically since the end of the 1990s (see charts). On average, over one-half of all teens in our state were employed in 1999-2000. By the end of the recession of 2001 and the jobless recovery from 2002-03, the teen employment rate had declined to 39% and improved only modestly over the next few years. After 2005, the teen job-holding rate fell anew especially after the Great Recession took hold, and the teen employment rate dropped to under 27% in 2012. This was the lowest teen employment rate for our state since the late 1960s when this data began to be published at the state level on an annual basis.  During the first ten months of 2013, the teen employment rate has only averaged 28%, the second lowest in our history. No other age group has fared so badly over the past 12 years in our state or the nation. These low rates of teen employment pull down the employment rates of 20-24 year olds through the path dependency effect. Employment rates of teens vary widely across race-ethnic and income groups, being lowest for Blacks and Asians and for youth from low income households.  Only 20% of low income teens had a job last year versus 33 to 36% of middle income youth and  44% of those from upper middle income families (100,000 to 150,000).

     In June 2012, the Massachusetts Board of Elementary and Secondary Education’ Task Force on Integrating College and Career Readiness issued its report From Cradle to Career: Educating Our Students for Lifelong Success. That report contained a series of recommendations including those related to a major expansion of job opportunities, internships, and career awareness activities for high school students. An expansion of School to Career Connecting activities would help achieve that goal. In the report, it was noted that only 24% of Massachusetts high school students were employed during an average month in 2010 with very large disparities between the lowest and upper middle income youth, with gaps between 12-13% at the bottom and nearly 30% at the top.  A current update of those results from the recently released 2012 ACS data show nearly identical results.  Again, only 24% of high school youth were employed with low income youth again faring the worst by far.  Only 14% of high school students from low income families (annual incomes under $20,000) were working in 2012 versus close to one-third of those in upper middle income families. The state has made no progress in achieving the employment goals of the Task Force on College and Career Readiness. We need to develop a reporting system listing the employment fate of our high school students, including a breakdown where available of employment rates by gender, race, family income, and geographic area of the state. We also need to document the role of employers in different industries across the state in putting our youth to work. Comparisons with the nation and other states across the country are also needed to place our performance in perspective.

Charts attached below:

Massachusetts Teen EP Charts ACS 2011-2012

Labor Market Problems in the Recovery from the Great Recession: Welcome to the Uncommonwealth of Massachusetts

The employment recovery from the Great Recession of 2007-2009 has left many U.S. workers behind, with lower income workers and less educated workers continuing to face far more severe unemployment, underemployment, and other labor underutilization problems then their more affluent counterparts.  The employment problems of U.S. workers that were a result of the Great Recession were very unevenly shared across household income and education groups; the gaps between the affluent and the low income population have been rising over time.  Regrettably, Massachusetts’ labor markets have performed equally as badly and in some cases even more poorly than the nation’s.  By the first quarter of 2013, the state still had not yet matched the number of payroll jobs it had generated in the first quarter of 2001, the previous historic high jobs count, and unemployment problems were two to three times as high as they were in 2000.

Our new report, “The Labor Market Problems of Massachusetts’ Workers in the Recovery from the Great Recession:  The Great Socioeconomic Divergence” is devoted to a more complete and rigorous analysis of the size and incidence of alternative labor market problems among Massachusetts workers in 2012-13, with comparisons dating back to 2000.  We show that combined labor underutilization problems among state workers have increased to a substantial degree over the past 12-13 years and that the distribution of such labor market problems has become far more unequal across key socioeconomic groups of workers, as represented by their educational attainment and household income group.  These widening socioeconomic disparities in labor market problems have contributed in an important way to the growth of earnings and income inequality in our state over the past decade.  We are no longer a true “Commonwealth” and the consequences are quite severe for the workers themselves, their families, and their communities.

Ed Mason, on the front page of the business section of the  Boston Globe, featured these research findings in the following article that ran October 27th, 2013.  “Knowledge economy is leaving some behind – The gap is widening between the poor and the rich in Massachusetts.” 

Key findings from the report on the rising gaps in unemployment rates across educational attainment and household income groups include the following:

  • 20% of workers from Massachusetts households with annual incomes of less than $20,000 were unemployed compared with 3.3% of workers from households with annual incomess of $150,000 or more.
  • 19% of high school dropouts in Massachusetts were unemployed, a rate that is three times that of the state’s overall unemployment rate of 7.2%.  The unemployment rate drops to just over 3% for those workers with a Master’s or higher degree.
  • The unemployment rate of low income, high school dropouts and high school graduates were in the 22 to 30 percent range, equivalent to a Great Depression, low-middle income high school graduates and those with some college faced unemployment rates between 9 and 12 percent, a Great Recession, while the best educated and most affluent had unemployment rates of only 1.5 to 2.5 percent, a “super full employment” environment.

The gaps in the labor market outcomes of Massachusetts workers get substantially worse when we expand our measure of the labor market problems of Massachusetts workers to those who are  underemployed and those who want jobs but have stopped actively looking for work.  Key findings:

  • 55% of Massachusetts workers who did not finish high school or have a GED and lived in a household with an annual income of less than $20,000 were unemployed, underemployed, or no longer searching for work compared to only 4% of those workers with a Master’s degree or higher and living in a household with an annual income of $150,000 or greater.

Full report: The Labor Market Problems of Massachusetts Residents in the Recovery from the Great Recession – The Great Socioeconomic Divergence

 

 

The Collapse of the School to Work Transition for Young High School Graduates

Several months  ago, the U.S. Bureau of Labor Statistics issued a report on the college enrollment/labor market status of high school graduates from the Class of 2012 as of October 2012.  The report highlighted the fact that about two thirds of all high school graduates were enrolled in a 2 or 4 year college and that  just under 70% of those graduates not enrolled in college were actively participating in the labor force., a high fraction of whom were unemployed (36%).  The report did not, however, cite the key  finding that only 45% of those who did not enroll in college were employed  in any type of job, tied for the record low employment rate  of the past two years  for such graduates for the last 50 years.  Young high school graduates in the U.S. were faring extremely poorly on all labor market measures.

The CLMS recently prepared  a report with Job’s for America’s Graduates, examining in detail the employment outcomes for those  young high school graduates from the class of 2012 who  were not enrolled in college.  Among our major findings are the following:

  • The overall employment rate for non-college enrolled grads was slightly below 47%, tied with the two previous  years for  the worst employment rates since the data  series began in the late 1950s.
  • For non-college enrolled men, the employment rate  was only 44%,  the lowest ever recorded, 28 percentage  points below the rate in 2000.
  • Employment rates are extremely low for Black (29%)  and low income youth(31%)
  • The share of employed youth with full time jobs was only 43%, the lowest ever recorded.
  • The full time employment rate for these non-college enrolled graduates for 2012 was only 19%, the lowest ever in the series.  For Black males it was 5%.  No gender or race-ethnic group achieved  a full time employment rate above 26%.

The absence of work, especially full time jobs, among recent high school graduates will reduce their future employment, wages, earnings, and training investments from employers.  It is also a major contributing factor to the “quiet riots” mentioned five years ago by then Senator Obama in a 2007 talk at Hampton University.  The presence of so many idle young high school graduates especially in our inner cities also sends the wrong signals to those youth contemplating dropping out of school.  If a  high school diploma is so important, why are there so many young grads out there  with nothing to do?  Who will well the people?  We hope that you will help us spread the word.  The time for a national policy response is now!

Full Report:  JAG School-to-Work Transition Policy Brief #1

CLMS Press Coverage Digest, July through September 2013

The Center has gotten a significant amount of press coverage this summer, at both the local level and at the national level.  Our national topics have included youth employment and the lack of summer jobs for youth, and the growing age and family income level twists in national employment levels, a subject which is featured prominently by the Associated Press and has been very widely distributed (see below).  Our more local topics have been on the Boston mayoral race and Boston’s future, the plight of low-income fast-food workers, and the positive impacts of the Youth Violence Prevention program created and administered by the Boston Foundation. 

The following link is to an article by Hope Yen of the AP.  This article was on ABC News, Fox News, Politico,  Huffington Post, the Boston Globe, the Minneapolis Star Tribune, the Kansas City Star,  thinkprogress,  Salon, the Washington Examine, and many more leading national and local publications.  In addition to Andy’s work for the story, CLMS Associate Director, Ishwar Khatiwada is also quoted and contributed heavily to the work that went into this story.  Link:

http://abcnews.go.com/Politics/wireStory/employment-gap-rich-poor-widest-record-20265592

 

 The following are more articles that featured Andy and the CLMS, in chronological order, since July of 2013. 

http://www.chicagotribune.com/news/opinion/plan/ct-edit-xproject2a-educ-1013-20131013,0,3575610.story

Chicago Tribune, Fixing schools to fix Chicago

http://www.wpr.org/study-shows-widest-unemployment-gap-record

Wisconsin Public Radio, “Study Shows Widest Unemployment Gap Record” (live radio)

http://online.wsj.com/article/SB10001424127887323893004579057063223739696.html

Wall Street Journal Online, “Wanted: Jobs for the New ‘Lost’ Generation”

http://www.post-gazette.com/stories/business/news/pennsylvania-fared-slightly-better-when-it-came-to-summer-jobs-for-teens-701623/

Post-Gazette, “Pennsylvania fared slightly better when it came to summer jobs for teens”

http://www.wbez.org/programs/morning-shift-tony-sarabia/2013-08-30/morning-shift-teens-struggle-find-jobs-tough-economy

WBEZ 91.5, “Morning Shift: Teens struggle to find jobs in tough economy”

http://www.nybooks.com/blogs/nyrblog/2013/sep/03/americas-jobless-generation/

The New York Review of Books, NYRblog, “America’s Jobless Generation”

http://archive.constantcontact.com/fs175/1102572750256/archive/1114760336389.html

The CAAL, a large national public charity, highlighted our work on the GED credential in their recent newsletter.

http://hereandnow.wbur.org/2013/08/02/teens-summer-jobs

90.9 WBUR (Boston NPR affiliate), “Summer Slump:  Teens Struggle to Find Jobs”

http://southbostontoday.com/tale-of-two-cities/

South Boston Today, “Tale of Two Cities”

http://www.bostonglobe.com/business/2013/08/29/other-cities-cut-back-mayor-tom-menino-bet-big-summer-jobs-for-teens/z2QvC205337gWRSE8bQAZI/story.html

Boston Globe, “Menino bet big on summer jobs”

http://www.mcclatchydc.com/2013/08/29/200769/teen-employment-hits-record-lows.html#.Uh_SqBjD-ic

McClatchy, “Teen employment hits record lows, suggesting lost generation”

http://prospect.org/article/one-way-end-school-prison-pipeline

The American Prospect, “One Way to End the School-to-Prison Pipeline”

http://www.bostonglobe.com/business/2013/08/26/local-fast-food-workers-join-nationwide-protest/veTe4XGKjLPc70acP4raoN/story.html

Boston Globe, “Local fast-food workers to join nationwide protest”

http://www.bostonglobe.com/opinion/2013/08/16/the-real-challenge-for-next-mayor-economic-inequality/3PngSDUvDNPV5KxKB22s2I/story.html

Boston Globe, “Poverty must be top priority for mayoral candidates”

http://online.wsj.com/article/SB10001424127887323423804579025192355931448.html

Wall Street Journal, “Summer Jobs Elude Many Teenagers”

http://blogs.wsj.com/economics/2013/08/21/elderly-more-likely-to-be-employed-than-teens/

Wall Street Journal, Real Time Economics, “Elderly More Likely to be Employed Than Teens”

http://www.afro.com/sections/news/afro_briefs/story.htm?storyid=79427

AFRO, “Youth Jobs Much More Than Paid Distractions Before a Diploma”

http://www.lowellsun.com/todaysheadlines/ci_23835243/bay-state-jobless-still-tough-struggle

Lowell Sun, “For Bay State jobless, still a tough struggle”

http://www.bostonglobe.com/business/2013/08/05/still-tough-for-teens-find-summer-jobs/lWw62PrSIZY5Fd8WtsX9GP/story.html

Boston Globe, “Still tough for Mass. Teens to find summer jobs”

http://www.pbs.org/newshour/businessdesk/2013/07/jobless-rate-for-poor-black-te.html

PBS Newshour, “Jobless Rate for Poor Black Teen Dropouts?  Try 95 Percent”

 

(Press Release) Teen Summer 2013 Job Market: No Progress for America’s Teens

Friday’s Employment Situation report for August 2013 revealed that the U.S. employers added 169,000 net new payroll jobs in August. The revised payroll employment estimates for the entire summer (June-July-August) revealed a gain of 445,000 jobs. Unfortunately, none of these payroll jobs were obtained by nation’s teens (16-19). Despite the fact that both the Center for Labor Market Studies and national job placement firm (Challenger-Gray-Christmas) had earlier projected that teen would benefit with improved summer job market, this development unfortunately did not occur.

Full press release attached here:  CLMS_Summer_Teen_Employment_Press_Release