It’s Hard Out There for a Teen, Especially in Alabama

Original Article:

  • Author: Michael Saltsman

  • Publication Date: July 2010

  • Newspaper: Birmingham News

  • Topics: Minimum Wage

While your average worker is mired in the midst of the Great Recession, the job outlook for teenagers is more reminiscent of the Great Depression: Nationally, more than one in four teens is unemployed, and the number is even higher in Alabama. A new analysis of the numbers by the Employment Policies Institute shows that the average unemployment rate for teenagers over the last year in the Yellowhammer State is a staggering 32.8 percent.

This crisis has been several years in the making but is just now coming to a head. After a 40 percent increase in the federal minimum wage between July of 2007 and July of 2009 – and additional hikes at the state level – it was only a matter of time before the most vulnerable among us were hit with job losses. The prolonged economic slump has only exacerbated the issue, making employers more wary than ever about taking on new employees – especially unskilled, low wage workers like teenagers.

It’s not like these job losses were impossible to see coming. Before the minimum wage went up, the University of New Hampshire completed a study of labor economists. Three out of four predicted that the minimum wage increase would mean fewer entry-level job opportunities. And lost jobs are what we have: A professor at Ball State University has shown that more than 300,000 part-time job opportunities have failed to materialize as a result of the increase to the minimum wage.

The scarcity of jobs for teenagers has real consequences. That first job is oftentimes the first dose of real responsibility most teens taste; at these entry level positions, they learn lessons from an “invisible curriculum.” Lessons like getting along with coworkers and showing up to work on time that can’t be taught in the classroom.
Failing to gain valuable experience now can have disastrous consequences for teenagers: Nobody wants to hire someone with no experience in the work place, but it’s impossible to get that experience without being given a chance in the first place.

Unfortunately, teens aren’t just having a hard time finding work. They’re also spending longer looking for work.

When we looked deeper at the numbers the Bureau of Labor Statistics put out this spring, we found a 174 percent increase over the last three years in the number of teenagers who have spent more than six months looking for a job. That’s a staggering figure! Almost one in three teens has been out of work for over half of a year while looking for a job.

If labor costs keep going up, these jobs are going to disappear permanently. Automation will continue to replace unskilled teenage workers looking for their first job in industries with razor thin profit margins like restaurants. Why do you think you bus your own tray at McDonalds? Do you know why you get free refills on soda at Burger King? It’s literally cheaper to put soda at the front of the store and allow people to take as much of it as they can drink than to pay someone to stand behind the counter and dispense it.

There’s a simple solution to this problem that doesn’t entail handing out billions in federal funds to create busy-work for teens, as some lawmakers have suggested doing. Just lower the minimum wage for teenagers. This will provide an incentive for businesses to take a chance on a young, inexperienced worker without displacing older, more qualified employees. It’s the only win-win-win solution for teens, employers, and taxpayers alike.

Michael Saltsman is the research fellow at the Employment Policies Institute, a nonprofit research organization dedicated to studying public policy issues surrounding entry-level employment.