Low-Skill Employees Still Suffering Difficult Labor Market
High School dropouts face exceptionally high unemployment rate
Publication Date: December 2004
Topics: Minimum Wage
Washington – Today’s recent jobs report finds weaker than expected numbers for the nation as a whole. The report is disturbing, particularly considering the crisis in unemployment facing low-skill employees the Employment Policies Institute noted today. Groups such as teenagers, high-school dropouts, and minorities continue to face crippling unemployment rates.
In November, the national unemployment rate fell to 5.4%. High school dropouts, however, faced an unemployment rate of 8.0%. This rate is 65% higher than those with a high school degree and 220% higher than employees with a college education. These facts make it clear that those with the least education and skills are finding it significantly more difficult to find employment throughout the economy.
Teenagers, another group of employees with few skills, are bearing the brunt of our nation’s unemployment rate. In November, teen unemployment was 16.6%, with African-American teen unemployment at 32.6%—over 500% higher than the national rate.
The most recent employment numbers make it clear that skill level remains one of the most accurate predictors of success in the labor market. Individuals with little employment experience or education have employment rates that are demonstrably higher than their counterparts. Research shows, however, that these low-skill individuals receive significant wage increases once they are able to cross the gateway into the labor force. Economists at the University of Miami-Ohio and Florida State University found that 65% of these entry-level employees receive raises within the first 1-12 months of employment.
“These recent jobs numbers shed a bright light on the importance of skills and work experience in our economy. Applicants with low-skill levels and little experience are being shut out of the labor force,” said Craig Garthwaite, director of research for the Employment Policies Institute. “This fact is all the more important as policymakers in Washington, DC and states across the country are considering minimum wage increases that would make it that much more difficult for these vulnerable employees to cross the gateway into successful employment.”
Gatewayjobs.com, a website focusing on the crisis in entry-level employment, provides regularly updated statistics detailing the employment market for entry-level employees and vital information about a host of government assistance programs designed to promote employment and economic success.