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Young Money: Youth Unemployment Rate Falls Across The Board

Youth unemployment fell to its lowest rate since at least 2005.

CREDIT: Flickr user Oscar Ucho.

In March, the economy added 98,000 jobs and the national unemployment rate fell to 4.5 percent, down from 4.7 percent in February. The youth unemployment rate, which tracks young Americans aged 16 to 24, fell even steeper, from 9.9 percent in February to 9.1 percent in March—its lowest rate in over a decade. However, these positive signs still largely represent economic policies enacted by the Obama administration as March was just the second full month under President Trump.   JobsDay_Mar17_1

 

Youth unemployment didn’t just fall overall, it fell across the board for white, black, Asian, and Latino youth. In March, the white youth unemployment rate fell 0.9 percentage points, from 8.7 percent in February to 7.8 percent. The black youth unemployment rate saw a drop of nearly 2 percentage points, from 16.2 percent to 14.3 percent. The Asian youth unemployment rate, which is particularly volatile because of its small sample size while particularly uninformative because of severe economic disparities among different Asian ethnic groups, fell from 10.3 percent to 9.3 percent. Latino youth saw their unemployment rate drop two full percentage points, from 10.8 percent in February to 8.8 percent. While declining unemployment rates across the board are positive, it’s also important to note that the black youth unemployment rate is still nearly twice as high as the white youth unemployment rate, and Latino youth also face higher-than-average unemployment rates.

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While unemployment fell both nationally and for youth, the labor force participation rate (LFPR) held flat in March, remaining at 55.8 percent for youth and 63 percent for all Americans. The labor force participation rate adds important context to the unemployment rate because it allows us to understand not just how many people are looking for work and unable to find it (the unemployment rate), but how many people out of the entire population are working. While youth unemployment has now returned to pre-Recession levels, the youth labor force participation rate has not. Before the Recession, the youth LFPR hovered above 60 percent, but fell to around 55 percent during the Recession and has remained there ever since. Therefore, while the youth unemployment rate has returned to pre-Recession levels, the overall economic situation for young people has not.

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