The young adult unemployment rate increased slightly to 6.5 percent, in January (seasonally adjusted), up from 6.3 percent in December. About 51,000 new young adults entered the workforce, which can cause the unemployment rate to increase. The number of unemployed also increased and by a larger margin than new young adults in the workforce. The young adult unemployment rate continues to persist at higher rates that the national unemployment rate, which also increased slightly from 4.7 percent up to 4.8 percent.
The unemployment rate grew for young Latinos, African Americans, and Asian or Pacific Islanders over the month (though these are not seasonally adjusted). Notably, the rate for Asian or Pacific Islander young adults doubled, from 2.7 percent to 5.5 percent.
The workforce has largely recovered since the Great Recession, as reflected by stronger employment rates, but new research published by Young Invincibles last month demonstrated longer-term structural problems for today’s young adults. Millennials today earn lower incomes, own houses at lower rates, and have amassed fewer assets and wealth than Boomers had when they were the same age in 1989.,This highlights that increased employment is just one piece of the puzzle needed to get this generation of young people back on track.
The unemployment rate for young adults fell to 6.3 percent in December 2016, its lowest point in nearly a decade. Last week’s report is the final jobs report of the Obama administration, which oversaw a volatile workforce that significantly impacted young adults. A few notable points:
- Young adults suffered from 54 straight months of double-digit unemployment rates between January 2009, when President Obama first took office, to June 2013.
- Young adult unemployment reached its height at 13.3 percent in April 2010.
- Last month’s rate of 6.3 percent is the lowest the rate has been since May 2007.
This graph below tracks the unemployment rate among young adults and the workforce generally over the last decade. It also highlights the weak jobs market President Obama inherited from the Great Recession and the slow recovery through his administration. the Recession (yellow area) officially began in December 2007, over a year before Obama took office and continued for at least six months into his presidency. The green indicates an overlap of both the recession and the Obama administration (remember how yellow and blue make green?). Starting with the recovery in June 2009, the unemployment rate for young adults steadily declined to last month’s historic low.
Taking a closer look at the most recent unemployment rates for December of last year, we see that despite overall gains, that young African Americans still suffer from the highest unemployment rates, double the rate overall, at ten percent. Young Latino adults also have higher rates at 7.3 percent. Young Asian or Pacific Islander adults had the lowest unemployment rates at 2.7 percent.
While the jobs market has generally recovered from the Great Recession in the short-term, last week Young Invincibles released new research analyzing long-term declines in financial security, which show that today’s Millennials earn lower incomes, own homes at lower rates, and have amassed fewer assets and wealth than Baby Boomers when they were the same age.
There are still nearly 1 million young African Americans actively looking for a job
March jobs numbers are out today and they largely show good news, with the addition of 215,000 new jobs and the unemployment basically holding steady at 5 percent. Measuring employment is a complicated endeavor as there are thousands of ways to slice and compare the data: historically, by demographics, by education attainment among many others.
At Young Invincibles, we monitor the monthly report and break it down by age, race and ethnicity as well as by groups that are particularly vulnerable to economic downturns and don’t always benefit from recoveries. Because the sample size for these groups is smaller, the Bureau of Labor Statistics doesn’t adjust for changes in the season, one accurate way to look for changes in the workforce is looking back a year to date. The idea is that the month of March has basically the same seasonable characteristics as any other March in a different year.
Below are the unemployment rates for March 2015 and March 2016, broken out by age and race and ethnicity:
The good news is that the unemployment rate has gone down for most groups. Young Asian adults is the only exception, although they do have the lowest unemployment rate, 4.8 percent, of any group in this analysis. Young Latinos in particular have seen their job prospects improve, dropping two points in the last year, and achieving parity with young adults in general. However, while African American young adults have also seen improvement, it is troubling to see their unemployment rate hover stubbornly above the rest and stuck in double digits.
According to today’s report, there are still nearly a million black young adults looking for a job (939,000). To be counted as unemployed in this rate, people have to be actively looking for jobs in the last four weeks. That should inspire action from our policymakers to make postsecondary education and training more affordable and available, and remind us how much more work there is to do to address structural inequalities in our economy.