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Young Money: Youth Unemployment Hits 9-Year Low In December, Youth Labor Force Participation Stays Steady

The youth unemployment rate continued to fall in 2016, while the youth labor force participation rate remained stagnant.

CREDIT: Pexels.

In the final month of 2016, the unemployment rate for all workers 16 and over continued its downward trend for the year, landing at 4.7 percent for January and 4.9 for 2016 as a whole. The youth unemployment rate, which measures workers aged 16-24, also fell, to 10 percent in December—its lowest rate for any month since March, 2007.  The overall youth unemployment rate for 2016 fell to 10.4 percent, down from 11.6 percent in 2015, 13.4 percent in 2014, and 15.5 percent in 2013.

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Though disparities in youth unemployment rates by race persist, 2016 saw decreases for white, black, Latino, and Asian youth. For white youth, the unemployment rate fell to 9.2 percent in 2016, down from 10 percent in 2015, 11.3 percent in 2014, and 13.5 percent in 2013. The black youth unemployment rate dropped to 17.5 percent in 2016, falling from 19.2 percent in 2015, 23.1 percent in 2014, and 26.6 percent in 2013. Latino youth, too, saw declining unemployment rates in 2016, falling from 16.6 percent in 2013 to 14 percent in 2014 to 12.4 percent in 2015 and 10.9 percent in 2016. While the Asian youth unemployment rate is less informative than other unemployment rates because of its small sample size and large variation among ethnicities within the category, it also saw a decrease in 2016. After rising slightly from 11.9 percent to 12.1 percent between 2013 and 2014, the Asian youth unemployment rate fell in 2015 to 9.5 percent and again in 2016 to 7.7 percent.

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Against a falling youth unemployment rate, the youth labor force participation rate (LFPR) remained steady in 2016. While the unemployment rate measures those who are actively seeking work but unable to find it, the LFPR shows the percentage of Americans working out of the entire population, not just those actively seeking work. In 2016, the youth LFPR rose slightly, to 55.2 percent, from 55 percent in 2013, 2014, and 2015. Before the recession, in 2005 and 2006, the youth LFPR hovered around 60 percent. The graph below shows how the youth LFPR has fallen and subsequently steadied since the recession, while the overall LFPR (for all workers 16 and older) also fell during the recession, but less drastically.

Dec16 Jobs3

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