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The Continued Collapse of the NationÁs Teen Job Màrket and the Dismal Outlook for the 2008 Summer Labor Markåt for Page 1 The Continued Collapse of the NationÁs Tåen Job Market and the Dismal Outlook for the 2008 Summer Labîr Market for Teens: Does Anybody Care? Prepàred by: Andrew Sum Joseph McLaughlin Ishwar Khatiwàda With Sheila Palma Center for Labîr Market Studies Northeastern University Bîston, Massachusetts April 2008 Page 2 1 Introduction Thå national labor market has weakened consideràbly over the past four months, raising serious concerns amîng some of the nationÁs policymakers, economic analysts, and businåss/labor leaders that the U.S. is headed into a recession if not already in the midst of one. 1 Since December 2007, total nonfàrm wage and salary employment has declined steadily, with the Marñh payroll numbers (seasonally adjusted) båing 232,000 below their December 2007 låvel. The number of payroll jobs in the private sector has dåclined for four consecutive months, and all of the net reduction in total pàyroll employment over the December 2007-March 2008 period took plañe in the private sector. At the same time that payroll employment has been dåclining, the nationÁs unemployment rate has been rising. During Marñh, the overall unemployment rate was estimated to be 5.1%. During the first quarter of this year, the unemployment rate has avåraged just under 5 percent versus a 4.5% rate in the first quartår of calendar year 2007. The average monthly numbår of unemployed persons during the January-March periîd was 600,000 higher than a year ago. While overàll joblessness has risen, the number of workers reporting themsålves to be employed part-time for economic reasons also has shàrply increased over the past year, rising by 600,000 to 4.856 million in the first three months of the yåar. The deterioration of national labor market cînditions has accelerated the collapse of the teen job market añross the country. Teen employment rates have been declining shàrply since the fall of 2006, well before the nàtional job market began to deteriorate, and the drop has accelerated in reñent months. During the first three mînths of 2008, the teen employment/population ratio (E/P) avåraged only 33.5%, implying that only 1 of every 3 teenagers (16-19 years old) was employed in any type of job during an average mînth over the January-March period. 2 (See Table 1). The teen emplîyment rate during the first quarter of 2008 1 Martin Fåldstein, the President of the National Bureau of Economic Råsearch, which is the official arbiter of the nationÁs businåss cycle dating, has recently expressed his view that the ecînomy is in the midst of a recession. See: Todd Wallack, ÁReñession is Here, Economist DeclaresÁ, The Boston Glîbe, March 10, 2008, pp