July 7 2014
Patrice J. Lee
According to last Friday’s jobs report, the unemployment rate ticked down again last month to 6.1 percent from 6.3 percent. It’s a positive sign that our economy added 288,000 jobs. However, part-time work is up compared to full-time work.
Overall, there's not much solace for the millions of Millennials, who are unable to find any employment or are working less than full time. This generation is suffering and Washington has no answers.
According to the latest census data, 40 percent of unemployed workers are Millennials which equates to 4.6 million unemployed young people — 2 million long-term. This surpasses the unemployment rate of Generation X (37 percent) and baby boomers (23 percent).
Meanwhile, the unemployment for 18-34 year-olds is 15 percent according to youth advocacy group Generation Opportunity. (In full disclosure I work for GenOpp).
Ours is a generation that is straddled with high student loan debt. The total outstanding student loan balance is $1.08 trillion and 11.5 percent of it is 90+ days delinquent or in default.
The shrinking unemployment rate masks a deeper disturbing trend for a generation that is coming of working age just at the moment that it needs opportunity most.
“I was surprised by how high that number is for millennials,” says Andrew Hanson, research analyst at Georgetown University, who conducted the analysis. “Unemployment is becoming a youth problem.”
Since the recession, the youngest job-hunters are being beaten by the oldest. The number of jobs held by baby boomers rose by 9% from 2007 to 2013, a gain of 1.9 million jobs, while the millennial workforce only snagged 110,000 jobs, up 0.3%, according to new analysis by software firm CareerBuilder and labor market data and software firm Economic Modeling Specialists International. (Generation X jobs fared worse, dropping 2.6 million, or 1%.)
“Entry-level jobs were choked off after the recession and those that were open were highly competitive,” says CareerBuilder spokesman Ryan Hunt.
Delayed career starts could impact the earning potential of a generation of Americans. The average worker today doesn’t earn the national median salary until the age of 30; in 1980, workers reached that point in their careers at age 26, Hanson says. One reason: Between 1987 and 2000, 30 million net jobs were added in the U.S., but when many millennials were entering the workforce between 2000 and 2013 only 4 million jobs were added. “Young people are the first to be let go by companies in a recession and the last to be let back in,” he adds.
And young men may also fare worse than young women. “With structural changes in the economy, there’s been a gradual decline in blue-collar jobs, which used to give more young men traction at an earlier age,” Hanson says. “Men especially have been failing to beat these entry-level standards in the labor market,” he says.
The news sounds dire for Millennials, and it’s true that the odds are stacked against us. The effects across our economy won’t be negligible: delayed home ownership (which fuels the economy), delayed family planning, and higher sustained student loan and credit card debt.
There is hope. Entrepreneurship provides a huge opportunity for young people. Technology facilitates new and traditional businesses in unique ways and Millennials are at the forefront. Whether it’s selling organic baked goods online or hosting supper clubs that assemble strangers for familial dining experiences organized through online platforms, many Millennials are not waiting for jobs but creatively owning their futures.
What we don’t need are empty promises of more government dollars nor do we need higher taxes and fees through policies like government-run healthcare. We especially don’t need state and local government stifling innovation like the restrictions on ridesharing programs like Uber and Lyft. We need government to work with us not against us.