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Young Money: At Midyear, Youth Unemployment and Labor Participation Rise

Amidst a flurry of news on trade, the youth unemployment rate rose slightly in the month of June.

CREDIT: Pexels

Amidst an escalating trade war with China, presidential threats to American companies, and doubt from the international community of America’s economic commitment to our European partners, the economy added 213,000 jobs in the month of June, with the unemployment rate ticking up to 4 percent. Following the overall unemployment rate, the youth unemployment rate for ages 16-24 rose by 0.2 percentage points to 8.9 percent, while the rate for ages 25-34 rose by 0.1 percentage points to 3.9 percent. The overall labor force participation rate (LFPR), which track the share of adults working or looking for a job, moved up 0.2 percentage points and now sits at 62.9 percent. The LFPR for workers ages 18-24 moved up by 0.3 percent and is now at 55.4 percent. The LFPR still lags behind pre-recession rates and together with a slow wage growth of 2.7 percent over the past year, indicates that the economy still has significant challenges to overcome.

June youth unemployment rate

Disaggregated by race and ethnicity, certain groups still experience unemployment at much higher rates. In the month of June, the black youth unemployment rate rose sharply by 2.9 percentage points and is now at 15.9 percent. The Latino youth unemployment rate rose by 1.2 percentage points and is now at 10.1. The Asian youth unemployment rate continues to experience volatility due to its small sample size, rising by 3.8 percent and now sits at 10.7 percent. The white youth unemployment rate also rose in the month of June by 1.4 percentage point and is now 8.9 percent. With the economy midway through the year, it’s important to take a look at the average unemployment rate from last year to compare with the average rate so far this year. The Black youth unemployment rate is 0.1 percent lower than the 2017 average and currently averages 14.5 percent. The rate for white youth is 0.2 percent lower than last year, sitting at 7.9 percent. For Latino youth, the unemployment rate is 0.1 percent lower and averages 9.4 percent. The rate for Asian youth is 1.2 percent lower than last year and is now at 7 percent.

June youth unemployment POC

While the LFPR for young people rose by 0.3 percent and 0.2 percent for all adults, the rate for ages 25-34 rose by only 0.1 percent and is now at 82.4 percent. The rate for this group hasn’t changed significantly through 2018 as it has hovered between 81.9 and 82.4 percent.

 

June 18 Youth LFPR

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