Juan Iraheta, 19, and Delaney Allen-Mills, 17, have little in common. Iraheta dropped out of school in 10th grade. He lives on the outskirts of Washington with his girlfriend and their 2-year-old son. Allen-Mills lives with her parents in McLean, Va., an upper-middle-class suburb of the nation's capital. She's a senior in high school, takes photographs for the school newspaper and is applying to college. What the two teens share is a lack of employment opportunities both Iraheta and Allen-Mills have struggled to find work.
Last year, Iraheta was working for electronics retailer Best Buy but had his hours cut. For the past few months he has been looking for a full-time job or one with evening hours so he can go back to school, but he hasn't been able to find either. Allen-Mills used to supplement her allowance by photographing children's birthday parties, but she hasn't been booked for a party in close to a year. She's been trying to land a job at the mall, but even at Tysons Corner Center, which is the fifth largest shopping center in America and just a few miles from her house, teen hiring is sparse. In mid-November, right before the holiday season, just 21 of the more than 300 shops there were advertising openings. Of those, almost all were looking for workers 18 or older. "A few years ago, I went to the mall with an older friend, and she got a job right away," says Allen-Mills. "Now the stores aren't even giving out applications." After four months of trying, she finally landed a gig in a beauty salon 25 minutes away from her home.
The job market is tough for everyone. But this recession has become a jobs disaster for 16-to-19-year-olds. "The numbers are incredible," says Andrew Sum, head of the Center for Labor Market Studies at Northeastern University and a nationally recognized expert on teen employment. "Proportionally, more kids have lost jobs in the past few years than the entire country lost in the Great Depression."
The retail and construction sectors, which are usually key employers of young workers, have been among the hardest hit. Manufacturing, another typical job source for those lacking a higher education or even a high school degree, is not the force in the economy it once was. The result: the teen unemployment rate neared 28% in October before falling slightly the next month. That's the highest ever recorded since the Federal Government began tracking it, and it's almost triple the 10% rate for all workers. Teens make up a relatively small portion of the 139 million people employed in the U.S., and by most accounts they would be better off staying in school than entering the workforce. But the small turf that teens have always held in the job market has been shrinking. For much of the past 60 years, the proportion of 16-to-19-year-olds who held jobs either part or full time was around 40%. In fact, in 2000 it was a relatively high 45%. In all, nearly 7.3 million teens were getting a regular paycheck.
Then something changed. Suddenly teens were being expelled from the workforce. It started during the pullback that followed the bursting of the tech bubble, but it never really stopped, not even during the housing- and finance-fueled expansion of the mid-2000s. From 2000 to early 2008, overall employment rose by about 10 million jobs. Teen employment headed in the other direction. By early 2008, teen employment had dropped by more than 1.5 million.
The problem is that older workers are crowding out kids. An economic expansion that at its height produced 11 million jobs, as was the case in the 2000s, isn't bad. But it is nowhere near as robust as the economic growth of the 1990s which upped employment by 17 million jobs or the increase of 20 million jobs in the expansion of the 1980s. What's more, 12 million people joined the workforce in the 2000s a million more new workers than the number of jobs created in that period. With fewer jobs to go around, older workers are settling for jobs that used to go to teens. Baby boomers, hurt by recent stock-market downturns, are hanging around longer. From 2000 to 2007, for instance, the number of 55-to-64-year-olds working in the retail industry rose by 553,000. At the same time, the number of teens who were able to snag jobs at stores fell 419,000, from nearly 2 million.