Wednesday, September 29

The teen employment boom is slowing in states that have scrapped unemployment benefits, new data suggests


  • Teen employment rates slowed in states that scrapped unemployment benefits early, new data shows.
  • Older workers filled empty roles in these states, according to an analysis commissioned by The Washington Post.
  • Overall employment didn’t rise in these states, the analysis from Gusto found.

Teen employment rates soared in May as businesses hired young workers in a tight labor market. But new research from Gusto, commissioned by The Washington Post, shows that teen hiring is slowing in states that have scrapped unemployment benefits, as older workers take on available jobs.

While some states have opted to end $300 weekly federal unemployment benefits early, others are keeping them until September, when they expire. Some politicians, and businesses, say benefits are discouraging people from going back to work, while others say they are a lifeline for people who have lost jobs or can’t work because of the pandemic.

According to Gusto’s employment data, there hasn’t been a spike in overall hiring in areas where unemployment benefits are cut — only a difference in who is hired.

In the states where benefits were cut, hiring rates for workers over 25 years old rose, it said. In states that didn’t cut benefits, it saw hiring for teenage workers jump, it said. Gusto said that this indicates that these benefits ” did play a role in the labor supply decisions of a group of adult workers.”

A tight labor market has left businesses across the US scrambling to attract workers. Some workers in the retail and restaurant sector who lost jobs over the pandemic have since found new roles elsewhere, or don’t want to go back because they’ve been put off by demanding customers and low pay.

In the meantime, businesses have been scooping up younger workers to fill these positions.

Luke Pardue, an economist at Gusto, previously told The Wall Street Journal that the US could see a record year for teen employment because of this.

The lack of older workers wanting these jobs means some teens have landed in higher-paying roles, with some in managerial positions earning as much as $50,000 a year.

“I’ve never seen anything like this,” restaurant owner Ben Eli – who owns Doris Metropolitan steakhouses in Houston and New Orleans – told The Journal. “They are 100% of my staffing right now.”



www.businessinsider.com