The first week of July marks the height of summer, and it also brings a wave of minimum wage increases at the state and local level. For teenagers hoping to earn extra money before the school year begins, higher wages might seem appetizing. However, a new EPI analysis of Census Bureau data shows this summer might just be serving up unemployment for teens hoping to get a job.
Previous EPI research explored California’s long history of minimum wage hikes and found that the state has consistently reported higher teen unemployment compared to others. While state and local minimum wages vary, some members of Congress want to raise the minimum wage to $15 per hour or higher.
What has been the impact of current state and local minimum wage hikes on teens nationwide?
To understand the current challenges faced by working teens and how further increases could make things worse, EPI analyzed data from the U.S. Census Bureau’s Current Population Survey (CPS) to calculate the 12-month rolling averages for unemployment and labor force participation rates in individual ages 16 to 19 years old across all states.
Teen unemployment is an important measure of how many 16 to 19 year olds can’t find jobs. As of May 2025, the states with the highest rates of teen unemployment are the District of Columbia, Colorado, California, Nevada, and Maryland – which also have some of the highest minimum wage levels in the country.
To confirm this trend, a regression analysis showed that statistically, minimum wage increases lead to higher teen unemployment, even when controlling for different states’ income levels (measured by state gross domestic product).
These findings fall in line with decades of economic research. A University of California-Irvine economist study found over thirty years of studies on the topic, the large majority find minimum wage hikes cause job losses. Research from University of Georgia, Ohio University, and Michigan State University all find higher minimum wages contribute to higher teen unemployment.
As many states begin implementing their new wage increases this week, it is crucial to monitor how these changes impact their teen populations. Minimum wage-earning positions often represent key opportunities for entry into the workforce, and help build skills to kickstart their careers. While higher wages may seem beneficial on the surface, our data shows that they may reduce crucial job opportunities, making it harder for teens to get their foot in the door.