Young Adult Employment Report, June 2012
The latest numbers from the Bureau of Labor Statistics reveal the last in a three month trend of weak job growth. With only 80,000 jobs added in the month of June, the economy failed to generate enough work to keep up with the population growth of the labor force, much less fuel a recovery for America’s workers. The unemployment rate for all workers held steady at 8.2 percent. In contrast to the hope for a real rebound inspired by relatively higher job growth in the first quarter of 2012 (with an average of over 225,000 new jobs created each month), the June numbers end the second quarter of the year with an average of just 75,000 jobs generated per month and suggest a sluggish trajectory for employment as the summer wears on.
A substantial part of the job growth in June (25,000 jobs) is attributed to employment in temporary services. While a temp position may be adequate for young people seeking summer work, those who are ready to begin a career or seeking more stability in their working lives may be disappointed – and churned back into unemployment just a few months from now. The sectors historically employing the largest numbers of young people – retail trade and leisure and hospitality – showed no increase in employment over May. Health services, which are the third highest employer of young adults during the summer months, added just 13,000 jobs.
The unemployment rate among workers ages 20 to 24 rose in June to 13.7 percent from 12.9 percent the previous month. At a time of year when many people in this age group usually go looking for summer jobs, participation in the labor market barely ticked up to 71 percent – lower than the rate of participation over the winter months but greater than it was one year ago. The jump in unemployment to its highest point since February reflects the market’s inability to absorb young workers looking for summer paychecks and experience, but still represents a significant improvement from last year’s average of 14.6 percent. Like the rest of the job market, young people are wading through slow growth with only the smallest increments of improvement to keep them engaged in the market. But unlike the rest of the labor market, just over 1 in 7 young people ages 20 to 24 who are looking for work cannot find it.
Workers 25 to 34, having finally caught up with the rest of the labor market in April of this year, managed to hold their ground with an unemployment rate steady at 8.2 percent. But that number belies a slight drop in labor force participation, which slid for the thirst straight month to 81.5 percent and is essentially unchanged from one year ago. Workers in this age group are not finding adequate incentives to join or remain active in the labor market, allowing the unemployment rate to hover at the national average even as fewer people ages 25 to 34 are employed.
In all, the June employment numbers indicate an economy treading water, and slowly at that. Both 20 to 24-year-olds and 25 to 34-year-olds have experienced a marked decline in unemployment rates since last summer, but those declines have not rallied workers to persevere in the labor market nor inspired new workers to enter. It is a trend of slow growth where the improvements that do arise are diminished by an ever more distant timeline for full recovery. At the same time, young adults need job growth that far-surpasses these second quarter numbers in order to support meaningful goals like financial independence, human capital investment, and asset building that will prove crucial to their success in the future. Eighty thousand jobs just isn’t enough.