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Young Money: Unemployment Drops Across The Board For Youth In August

Youth unemployment fell to 10.2 percent in August.

CREDIT: Pexels.

In August, the economy added 151,000 jobs, and the national unemployment rate remained steady at 4.9 percent for the third straight month while the youth unemployment rate fell to 10.2 percent from 10.8 percent in July. The national unemployment rate tracks all workers 16 and older who are seeking employment, while the youth unemployment rate considers just 16- to 24-year-olds.

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Notably, the drop in the youth unemployment rate applied across the board: white, black, Asian, and Latino youth all saw decreases in the unemployment rate. The black youth unemployment rate dropped significantly, from 20.6 percent in July to 15.7 percent in August. This is just the fourth month since 2008 that the black youth unemployment rate, which was as high as 30 percent just a few years ago, has been at or below 15.7 percent. Meanwhile, the white youth unemployment rate dropped 0.9 percentage points from July, to 9 percent in August, the Latino youth rate fell 0.8 percentage points, to 10.5 percent, and the Asian youth unemployment rate fell 0.2 percentage points, to 9.8 percent. Part of these declines could be attributable to students returning to school who are no longer looking for work (the unemployment rate tracks people who are actively looking for work).

In broader context, however, the unemployment outlook for white, black, Latino, and Asian youth in August still looks much brighter than the annual averages from 2009 through 2015 portray. In 2009, white youth faced an annual average unemployment rate of 15.7 percent, black youth 28.8 percent, Latino youth 20.2 percent, and Asian youth 14.8 percent. Even just last year, in 2015, white youth experienced a 10 percent unemployment rate, black youth faced a 19.2 percent unemployment rate, Latino youth encountered a 12.4 percent unemployment rate, and Asian youth had a 9.4 percent unemployment rate. Today, in terms of year-to-date averages, those numbers are down: the year-to-date white youth unemployment rate is 9.5 percent, the black year-to-date average is 17.8 percent, the Latino average is 10.9 percent, and the Asian rate is 8.4 percent.

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Meanwhile, the youth labor force participation rate (LFPR), which identifies the percentage of the 16- to 24-year-old population that is working or actively seeking work, fell from 54.9 percent in July to 55.6 percent in August. The national LFPR stayed constant at 62.8 percent. Notably, the youth LFPR has still not recovered from the recession: between 2000 and 2007, the youth LFPR hovered between 60 and 65 percent. Since 2010, however, the youth LFPR has remained persistently around 55 percent. Even though the youth unemployment rate has declined in recent years, the lower LFPR signifies that a smaller percentage of young workers are working or actively seeking work than before the recession.

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