Young People's Toehold On Jobs Slips In Weak Economy
It's a labor market trend that's been noted before but it's still worth paying attention to. The recession has seriously hurt the efforts of younger people to get in or stay in the labor force.
The Economic Policy Institute reminds us of how bad the numbers are for workers between 16 and 24. Their workforce participation rate has fallen to 54.7 percent from 59.1 percent.
Anxious older workers are keeping their jobs in the present economic environment, crowding out younger workers.
EPI suggests Congress make retirement entitlements somewhat richer to as a way to induce workers who are at 64 years old to leave the workforce.
The labor force participation rate for workers age 16-24 has decreased from 59.1% to 54.7% in the 25 months since the recession started, representing a loss of 1.3 million young workers, while the labor force participation rate of workers age 55 and older increased from 38.9% to 39.9%, representing an increase of 2.3 million workers. Many older workers are not retiring or are re-entering the labor force because they have suffered a sharp decline in economic security due to the collapse of the housing bubble and the plunge in stock prices. At the same time, workers age 16 to 24 -- who face an unemployment rate of 18.9%, compared to 6.8% for workers age 55 and older -- are having a difficult time securing employment and are leaving the labor force in large numbers. This lost work experience is likely to have a lasting detrimental effect on the wages and occupational paths of these young workers. Congress should consider making Medicare and unreduced social security retirement available to workers at age 64 for the next two years so that older workers would be able to retire. Such a policy would have the added benefit of creating job openings for younger workers.