The Deteriorating Labor Market and Economic Well Being of the Nation’s Teens, Young Adults (20-29 Years Old) and Young Families: A Renewed Call for National Action Center for Labor Market Studies Northeastern University Boston, Massachusetts October 2007

1) The steep decline in national teen employment prospects since 2000; new historical low, year- round employment rates for teens, especially males, in 2007; the strong path dependence of teen employment 2) The demise of the teen summer job market; who worked in the summer of 2007; record low summer employment rates in the summer 2007; the case for a revitalized summer jobs programs

3) Trends in the real weekly earnings of full-time young workers; the declining relative earnings position of young adults 4) Long-term trends in the real annual earnings of young adult (20-29 year old) men and women by educational attainment; widening gaps in real earnings across young adult 5) Trends in the lifetime earnings of men and women by educational attainment

6) Why We Should Care About Declining Real Annual Earnings Among Young Adult Men Without Four Year Degrees, Changes in the Marriage rates of young adult men  Changes in the living arrangements of young male adults  Incarceration rates among young adults by educational attainment  Changes in out-of-wedlock births among young adult women in the U.S. and the state of New York

7) The changing economic circumstances of young families in the U.S. and consequences for the future economic well-being of their children  Trends in the median real incomes of young families in the U.S. and New York, the very low incomes of families with children  The poverty/near poverty status of young families with own children present in the home  The distribution of income among young families with children in the U.S. and New York

Trends in the Employment to Population Ratios of Teens (16-19) in the U.S., Selected Years 1979 to 2007 (Annual Averages in %)

Trends in the Employment to Population Ratios of Male Teens (16-19) in the U.S., Selected Years 1979 to 2007 (Annual Averages in %)

E/P Ratios by Age Group in the U.S., 2000 and 2006 (Annual Averages, in %) “The Great Age Twist in Employment Rates in the U.S.”

Percentage Point Changes in E/P Ratios by Age Group, U.S., (Annual Averages)

The Share of Growth in Employment Attributed to Teens (16-19 Years Old) in the U.S., Selected Time Periods

Teen Share of National Employment Growth from the Pre-Recession Peak in 2001-I to May-July 2007 and the Job Recovery Period from May-July 2002 to May- July 2007 (Seasonally Adjusted)

Teen Employment Rates in New York: 2006 Averages (ACS) Teens in New York have been working at rates well below the U.S. average and far below those for the top performing states in the country. In New York, only 28 percent of teens were employed in a typical month in The state ranked last on this measure (20-24 percentage points below the top five performers.

Only 1 of 5 high school students in New York were working in 2006, the state ranked 3 rd lowest among the 50 states; less than half the employment rate of top five states. Only 53 of every 100 teenaged high school graduates had any type of job in New York; 5 th lowest among the 50 states; 24 to 32 percentage points below the top five.

Only 36 of every 100 teenaged college students worked in New York during 2006; lowest employment rate in the country; 20 to 26 percentage points below the top four state performers.

Employment Rates of All Teens and High School Students in the Top Five and Bottom Five States in the U.S., 2006 (in %)

Employment Rates of Year Old Non-Enrolled High School Graduates and College Students in the Top Five and Bottom Five States in the U.S., 2006 (in %)

2006 Employment Rates of Year Old High School Students in the U.S. by Race/Ethnic Group (in %)

2006 Employment Rates of Year Old High School Students in the U.S. by Family Income Relative to Poverty Line (in %)

Rankings of Employment Rates of Year Olds in the 20 Largest Cities in the U.S., Total and Enrolled in School, ACS 2006

Rankings of Employment Rates of Year Old H.S. Graduates and H.S. Dropouts in the 20 Largest U.S. Cities, Total and Enrolled in School, ACS 2006

The Counties of New York With the Six Highest and Six Lowest Teen Employment Rates During 2006

The Projected Change in the Total and the Year Old Population of New York State Between 2005 and 2015

Why We Should Care About Improving Teen Employment Prospects, Especially Among High School Students?  In-school employment, especially work based employment, provides teens an opportunity to see the relevance of school based learning for labor market performance – they can see the links between school and work  Improves high school graduation rates among economically disadvantaged youth; dropout rates are highest among disadvantaged youth who do not work in high school

 Strongly facilitates the transition from high school to the labor market upon graduation for both those graduating youth who do not immediately enroll in college as well as those who do  Reduces pregnancy rates among teenaged girls; those teenaged girls who live in areas with high employment rates are less likely to become pregnant

 Reduces male teen involvement in delinquent behavior, especially property type crimes

Summer Employment Rates of the Nation’s Teens from 2000 to 2007 (in %, Seasonally Adjusted)

Comparisons of Teen Summer Employment Rates in 2000 and 2007 for Gender and Race-Ethnic Groups (Seasonally Adjusted in %) Note: Summer employment rates for Hispanic teens are not seasonally adjusted.

2007 Summer Employment Rates of the Nation’s Teens for Gender and Race-Ethnic Groups (in %, Seasonally Adjusted)

Comparisons of the Employment Rates of Year Olds in the U.S. by Single Age Group, June – July 2000 and June – July 2007 (in Percent, not Seasonally Adjusted)

Employment/Population Ratios of Year Olds by Single Age Group in the June – July Period of 2007 (in %, not Seasonally Adjusted)

Employment/Population Ratios of Teens in the U.S. by Household Income, Summer 2007 (Not Seasonally Adjusted)

Summer 2007 Employment Rates of Teens by Household Income and Selected Race-Ethnic Group (in %, Not Seasonally Adjusted)

Comparisons of Teen Summer Employment Rates in Previous Peak Years and 2007 (Not Seasonally Adjusted, in %)

Estimating the Number of Additional Teens That Would Have Been Employed in the Summer of 2007 if Previous Peak Year Employment Rates Had Been Achieved (in Millions)

The Goals, Planning, Funding, and Design of A New Summer Jobs Program The primary goal would be for local WIB organizations together with private employers, high schools, colleges, and state/local government to provide both employment and learning opportunities for the nation’s teens, including youth from families with incomes below the low income level (200% of poverty line) The first year goals would be to provide subsidized and unsubsidized jobs for at least one million teens in the summer of 2008; funds could be used to create subsidized jobs in the public and nonprofit sectors, provide wage subsidizes for private sector employers, and expand unsubsidized job opportunities for teens via strengthened connections with employers

The Goals, Planning, Funding, and Design of A New Summer Jobs Program (Continued) The funding for the program must be provided immediately by the U.S. Congress to give local and state organizations sufficient time to plan and design the program Low income teens are the prime target group, but youth from higher income families can be served by the program with subsidized wages for private employers and unsubsidized jobs A first year funding level of $2 billion will be set by the Congress and allocated to states based on their share of national jobless youth and youth in low income families

The Goals, Planning, Funding, and Design of A New Summer Jobs Program (Continued) All participants will be expected to participate in learning based activities during the summer. These activities will take place at the worksite in small educational settings in community colleges.

Trends in the Median Real Weekly Earnings of Young Men and Women Employed in Full-Time Wage and Salary Jobs, (Constant 2005 Dollars)

Median Weekly Earnings of Full-Time Employed Year Olds Relative to Adults 25 Years of Age and Older

Trends in Median Annual Earnings of Non-Enrolled Year Old Males in the U.S. By Educational Attainment,

Trends in Mean Annual Earnings of Non-Enrolled Year Old Males in New York By Educational Attainment,

Percent Change in Mean Annual Earnings of Non- Enrolled Year Old Males in New York by Educational Attainment,

Trends in the Relative Median Annual Earnings of Non- Enrolled Year Old Men in the U.S., by Educational Attainment,

Trends in the Relative Mean Annual Earnings of Non- Enrolled Year Old Men in New York, by Educational Attainment,

Mean Lifetime Earnings of Year Old Males in the U.S. by Level of Educational Attainment, (in 2005 CPI-U Dollars)

Mean Lifetime Earnings of Year Old Females in the U.S. by Level of Educational Attainment, (in 2005 CPI-U Dollars)

Percent Change in the Lifetime Earnings of Year Old Adult Males in the U.S. by Their Level of Educational Attainment,

Mean Lifetime Earnings of Year Old Males in the New York by Level of Educational Attainment, (in 2006 CPI-U Dollars)

Percent Change in the Lifetime Earnings of Year Old Adult Males in New York by Their Level of Educational Attainment,

Marriage Rates of Year Old Men By Level of Annual Earnings, U.S., 2006

Percent of Year Old Males Who Were Married and Living With Their Spouses by Educational Attainment, March March 2007, U.S.

Percent of Year Old Males Who Were Living With Parents or Other Relatives by Race-Ethnic Group and Educational Attainment, U.S., March March 2007

Institutionalization Rates of Year Olds, All and By Level of Educational Attainment, U.S., 2006

Institutionalization Rates of Year Old Males By Level of Educational Attainment, U.S., 2006

The Adverse Consequences to Children of Growing Up in A Young Single Parent Family  Children in such families face serious cognitive problems; their academic achievement scores are well below average, especially when the mother has weak academic skills  They are more likely to experience both physical and mental health problems  Children are more likely to be held back in high school, fall two or more years behind modal grade, fail to graduate from high school

 Children in single parent families are less likely to work in high school, especially when their mother or father is not working  Female children in these single parent families are more likely to become mother as teenagers  Male children in these families are more likely to become involved with the criminal justice system, to be arrested, and to be sentenced to a juvenile detention facility

Number and Percent of Births to Women Under 30 that were Out-of-Wedlock by Educational Attainment of the Mother, U.S.: 2004

Percent of Births to Women Under 30 That Were Out- of-Wedlock by Educational Attainment of the Mother, U.S.: 2004

Trends in the Share of Births to U.S. Women Under 30 that were Out-of-Wedlock, Selected Years, 1960 to 2003 (in %) Year Percent

Percent Change in the Median Real Incomes of U.S. Families by Age of Family Householders and Presence of Children in the Home, (in Constant 2003 Dollars)

Median Income of Young Families (Under 30) With Children by Educational Attainment of the Family Head and by Family Type, U.S., 2006

Median Income of Young Families (Under 30) by Educational Attainment, U.S., 2006

Trends in the Distribution of Income Among Young Primary Families (Head Under 30) in the U.S., Selected Years, 1967 to 2004 (in %)

Mean Pre-Tax Income of Young Families in New York (Householder Under 30) by Selected Decile of the Income Distribution, 2006

Changes in Median Family Income in the U.S., NY, and New York City, (in 2006 Dollars)

Percent of Young Families that were Poor or Near Poor in 2006, by Type of Family, U.S.

Percent of Young Families that were Poor or Near Poor in 2006, by Type of Family, New York

Mean Annual Payroll and Federal/ State Income Taxes Paid by Non-Enrolled Year Old Adults in Massachusetts by Educational Attainment, Averages

Mean Annual Value of Cash and In-Kind Transfers Received by Non-Enrolled Year Old Adults in Massachusetts by Educational Attainment, Averages

Mean Taxes Paid- Transfers Received by Non-Enrolled Year Old Adults in Massachusetts by Educational Attainment, Averages

Lifetime Mean Taxes Paid - Transfers Received Plus Institutionalization Costs of Year Old Adults in Massachusetts by Educational Attainment

What Can Be Done? 1. We need to raise the political visibility of these problems at the local, state, and national levels  With the media  With our local political and business leaders  With the state legislatures and governors  With our national leaders

2. We need a number of immediate political actions  Year-round job creation program for teens  Revitalized summer jobs program  Renew and expand the QUOP program to boost the basic skills and educational attainment for disadvantaged youth  Provide NLCB monies for dropout prevention programs  Provide CBO’s, alternative schools, community colleges, monies to bring dropouts back to school (jobs / education)

 Massive expansion of youth apprenticeship opportunities  Expand the existing EITC credits for young single adults; allow both husbands and wives in young families to be eligible for EITC credits based on own incomes  Enforce child support laws; mandatory work for fathers not providing such support  Expanded education and training for young ex- offenders

“Human progress does not roll in on the wheels of inevitability. It is the result of the hard work of men working together with God recognizing that time is always on the side of social stagnation. We must use time creatively, with the knowledge that the time is always ripe to do right”.

Questions

Percent of Births in the U.S. that were Out-of-Wedlock by Age of the Mother, < Age Group Percent

Percent of Young Families (Under 30) With Kids Under 18 Present At Home Who Were Poor/Near Poor, U.S., 2006

Changes in Mean Annual Earnings of Non-Enrolled Year Old Males in New York by Educational Attainment,

2006 Employment Rates of Year Old High School Students in the Top Five and Bottom Five States (in %)

Employment Rates of Year Olds By County in New York City, ACS 2006

Employment Rates of Year Olds Enrolled in School By Selected Counties in New York, ACS 2006

Employment Rates of Year Old High School Dropouts By County in New York City, ACS 2006

Estimated Independent Impacts of Alternative Hours of Paid Work in the Prior Year on the Probability of Teens Being Employed at the Time of the 2006 ACS Surveys (in Percentage Points)