Another month of weak job growth seems especially cruel after the greater-than-expected employment gains in February. But workers were already onto the trend, leaving the labor market in droves throughout March despite the anomaly of a statistical surge in hiring the month before.
By now, young people are well-aware of their prospects: when the labor force shrank by almost half a million workers last month, more than two-thirds of those who left were under age 35. Maybe they knew what was coming, since employment for 20 to 34-year-olds fell by 117,000 jobs in March—greater losses than among all workers over age 35 combined.
Positive jobs numbers, like those released for February, should draw workers back into the economy as they identify new opportunities for employment. That kind of optimism drives labor force participation rates up and with it the unemployment rate, as more workers engage in the job search.
But rather than a flood of renewed hope, our market is as discouraged as ever: the labor force participation rate overall sank to its lowest point in 34 years, resulting in a decline in the unemployment rate to 7.6 percent. Labor force participation rates for 20 to 24-year-olds and 25 to 34-year-olds are at their lowest point in 6 months, with 70.1 percent of 20 to 24-year-olds engaged in the market and 81.4 percent of 25 to 34-year-olds. In March, labor force participation rates for young people neared their recessionary lows.
The decline in labor force participation pushed the unemployment rate for 25 to 34-year-olds down to 7.4 percent—lower than the national average. But 20 to 24-year-olds didn’t even get this statistical advantage. Even though they lost workers from the market in March, they lost plenty of jobs too, and unemployment for 20 to 24-year-olds actually climbed to 13.3 percent for the month.
Young people have seen all this before. Last year, an unseasonably warm winter led to discrepancies in the mid-winter/early-spring data that showed big gains and then petered into another long summer of disaffected youth. Labor force participation sank to levels unseen since women joined the labor market in force, and the rest of the year offered little to draw young people back to the job search. Another year like 2012 would be a devastating blow to young people and the future of our economy.
Yesterday Demos released a new report, Stuck: Young America’s Persistent Jobs Crisis, which outlines the implications of allowing the trend to continue. Crucially, at the rate of job growth we’re experiencing it will be yet another decade before young people are on track to a productive future. Even so, this generation of young adults will bear the scar of the Great Recession well into their working lives. It is time to take action to repair the stalled economy, though targeted job creation policies and decent standards for employment across the board. It may be hard to get the bad news after a month of positive indicators, but it will be far worse if we allow the losses to mount and amplify.