Tag Archives: unemployment

By William A. Foster, IV

You can be young without money but you can’t be old without it. – Aristotle

There is an unemployment epidemic in African American teenage unemployment. Its ramifications will indict an entire generation of our youth if it is not confronted. Yet, it continues to get brushed under the rug assuming anyone acknowledges it at all. A recent report by the International Labor Organization addressing high youth unemployment in the European Union is quoted as saying “There is a price to be paid for entering the labor market during hard economic times. Much has been learned about “scarring” in terms of future earning power and labor market transition paths. Perhaps the most important scarring is in terms of the current youth generation’s distrust in the socio‐economic and political systems.” However, there seems to be little attention being given to the plight of African American teenagers. Below is a look at a graph of European youth unemployment followed by the US Department of Labor’s view of African American teenage unemployment.

Scarring is the term that economist use in describing long-term unemployment for youth. This is because the compounding impact of it for the individual, household, and community ends up being much like a wound that is almost impossible to heal. Individually, African American teenagers are missing out on the basics of developing work ethic, work skills, networking through employment, early professional success which builds long-term confidence, and a host of other qualitative factors that tend to impact an individuals career trajectory. Because there is high teenage unemployment in African American households and communities it goes without saying that idle time is the devil’s playground. The increased idle time increases the probability of counterproductive behavior especially when there is such an acute quantity of unemployed teenagers.

The economic implications are profound. If we assume a teenager starts working at sixteen and is making minimum wage while working 20 hours a week average, they would earn $6 786 annually after taxes. It does not seem like much on face value but let us dig a little deeper. Let us assume the teenager gives $2 400 a year to the household income, puts aside $1 500 a year for college or vocational training, and lastly puts the remaining $2 886 in a Roth IRA account. First, 38.2 percent of African Americans are in poverty (see chart below) according to the National Poverty Center so an extra $200 a month can often mean the difference between a refrigerator full of groceries and malnutrition for a family. Malnutrition which has been shown to have not only health implications but long-term correlations to academic consequences for children in a household as well. The savings for college would allow the teenager to start college at eighteen with $4 500 in savings. This small amount should not have severe implications on a students’ financial aid but it could be the difference between a student purchasing books at the beginning of the semester as opposed to waiting on their refund which puts students behind during a semester and impacts their chances of academic success and ultimately their ability to graduate in a timely manner. Anyone who has attended an HBCU can readily attest to this reality either for themselves or classmates in experience. Lastly, the $11 544 invested in a Roth IRA after four years with average returns would be approximately $15 000 towards retirement saved at the age of 20. However, they can not touch this retirement account until they are 65. If they did not add another dollar to it and just continued with average returns over the next 45 years that account would be worth $2.5 million by retirement.

The International Labor Organization calls for the following actions to address youth unemployment:

• Fostering pro-employment growth and decent job creation through macroeconomic policies, employability, labour market policies, youth entrepreneurship and rights to tackle the social consequences of the crisis, while ensuring financial and fiscal sustainability.
• Comprehensive measures targeting disadvantaged young people in advanced economies with high numbers of unemployed youth. These include education, training, work experience support and recruitment incentives for potential employers.
• Integrated employment and livelihoods strategies and programmes in developing countries, including training in literacy, occupational and entrepreneurial skills and business support.

These solutions could be applied here in the United States and certainly could be implemented on a more micro level by community organizations operating within African American communities and give a good base for starting to stem the tide. There are 1.9 million African American owned businesses, but 1.8 million of them have no employees. These young people offer an affordable labor option for African American small businesses that in exchange could provide them priceless experience and professional building. Unfortunately, most African American teenagers are ill-equipped for very basic work beyond physical labor so training programs are vital. A difficult task to meet as local city and state budgets are cutting job training programs not expanding them. Therefore, community centered solutions must be examined. Any belief that there will be government assistance or grants should be viewed as no more than a bonus if an organization can get it.

African American teenagers are a silent group suffering and their current condition do not bode well as the stated above reasons show for African America’s future economic condition. They have the least voice among any group it appears in America but given the percentage of African American single parent households are arguably the second most important wage earner in the family. If the children are our (economic) future as Whitney Houston once said, then the future economic condition is looking bleaker and bleaker for African Americans.