Don't Be Ridiculous. The Youth Unemployment Crisis Is a Crisis.
For whatever reason, the world of economic punditry has really been trying to make youth unemployment way more complicated than it needs to be. First it was Jennifer Graham at the Boston Globe writing that youth unemployment is high because young folks have suddenly fallen prey to a big bout of The Lazy owing, among other things, to having been given too many trophies as children. ThenTime reported on some surveys that show that youth unemployment is being driven by college graduates suddenly having very inadequate soft skills. Now it is Zachary Karabell at The Atlantic arguing that young college graduates are choosing not to work on the hope of getting better jobs down the line, and that the rest of the youth who aren't college graduates are simply victims of structural unemployment.
Now in reality, we all should know by now how goofy this analysis is. I hate to kill the surprise conclusion right at the top here, but the real story is we had a massive recession in late 2007 and the economy has yet to recover:
If you've got some special story for why youth are so unemployed, then you better have some special story for every other age group as well because the trends are all basically the same. When unemployment trends are running the same across all age groups, right-thinking analysts realize that's a macroeconomic problem. No special case stories about youth are necessary. I know it's boring and painfully repetitive, but sometimes reality swings that way.
On his way to getting the youth unemployment diagnosis wrong, Karabell says a number of strange things also worthy of special attention.
First, Karabell, like almost everyone else, really seems to be wildly confused about who "the youth" actually are. He begins his interrogation of the issue of youth unemployment by writing: "It’s best to start with the unemployment rate among recent [four-year] college graduates, which attracts the lion’s share of attention."
Now in actual reality where real people live, this is a horrible place to begin an analysis on youth unemployment. Why? Because only 24 percent of the people between the ages of 18 and 29 have a four-year college degree. For those between the ages of 25 and 29, the number is about 37 percent. As we've reported here at Demos, the unemployment rates for these folks tend to be 50 to 75 percent lower than the unemployment rates for the majority of youth without such degrees. Taking the most highly educated quarter of young people and analyzing their labor market plight as the one most representative of the youth in general makes no sense whatsoever, though it does give you some insight into what certain people really care about when they talk about "the youth." (hint: it's not the youth, but rather well-off people who happen to be a certain age).
As Karabell continues his piece, he gives us a bit of anecdotal color, which wrong-thinking people believe is a good way to figure out the aggregate conditions of tens of millions of people:
Take a 25-year-old woman I met recently, who left her job to develop an app, work on a live-stream talk show, and write a book. If by some chance the Bureau of Labor Statistics contacted her, she would say that she doesn’t have a job, and hasn’t been looking. She would simply evaporate from the labor force and be considered unemployed. But are her decisions a symbol of systemic crisis and failure? No.
Now this paragraph is absurd for a number of reasons. Obviously the idea that this woman is representative of a great number of youth is not supported by any of the aggregate data we have. But here is another thing that I personally get a kick out of: "She would simply evaporate from the labor force and be considered unemployed." No actually, that's not how the labor force classifications work. She would be counted as Not In Labor Force and would not contribute to the unemployment rate. So even Karabell's anecdotal bit of color presents an example that doesn't actually help him explain away the high unemployment rate that he is so desperately trying to because this woman would not even be counted as unemployed!
From that perilous paragraph, Karabell marches through a few data roadblocks that point out how wrong his take on things are, specifically his view that this unemployment isn't so bad. He takes care of them though, letting us know that the "BLS has only been collecting data on age, unemployment and subsequent incomes for a few decades." Just nearly around half a century of data folks: "we should be wary of these statistics." Once that is all tossed aside, he is able to comfortably, and with no support at all, conclude that really these college-educated young folks are living with their parents and just holding out for better work than the work they can get right now. Of course this doesn't square at all with the data showing massive underemployment among college graduates spiking right as the recession hit, but then again that data does come from the apparently untrustworthy Bureau of Labor Statistics.
Finally, after spending his entire piece on a subset of the youth that actually represent less than a quarter of youth, he does spend two paragraphs quickly mentioning that the plight of the other 76 percent of youth is really just about structural unemployment, i.e. there is a skills mismatch between what skills these young people have and what skills employers are looking for. This conclusory assertion is ridiculous: our unemployment woes are cyclical, not structural (Konczal had him beat on this a few years ago).
As I've said in posts like this before, there really is no need to make this more complicated than it has to be. Young people are out of work just as folks from every other age group are out of work. Fixing it will require economic stimulus that brings the economy back to capacity and full employment. Since nobody in power seems worried about that, the youth, especially the majority without a college degree, will continue to languish. This is the path the powers that be have chosen for them.