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Too Many Young Men Still Aren’t Working

Justin Fox
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Too Many Young Men Still Aren’t Working

(Bloomberg Opinion) -- In January 2010, with the Great Recession technically over but employers not yet adding jobs, a breakthrough in American labor markets and gender relations transpired. That month, a higher percentage of women aged 20 through 24 were employed than men in that age range. This was, as best I can tell, the first time women in any of the age brackets tracked by the Bureau of Labor Statistics had ever outdone their male peers in employment-population ratio, or Epop.

It was also the last. As soon as hiring started again, young men returned to the workforce more rapidly than young women, and young men’s Epop went back to being several percentage points higher than young women’s.

Lately, though, the lines tracking this labor market statistic have been converging again.

It’s not as if young women are breaking new employment records: their Epop is still one-and-a-half percentage points below its 2001 peak. Young men’s Epop, meanwhile, is more than nine percentage points below its 2000 peak, and five percentage points below the high it reached during the last expansion, in 2006. This is happening even as prime-age (25-54) men have been returning to the workforce after some tough times, as I wrote last week. And while a large share of people in their early 20s are still in school, young women are more likely to be enrolled in college than young men are, so that can’t be what’s causing the convergence.(3) Something strange is going on with young men and the labor market.

Last year Jeanna Smialek (then at Bloomberg, now at the New York Times) made a similar observation based on employment data for men and women in the 25-34 age range. There the Epop lines are nowhere near converging — mainly because the women are much more likely to be at home taking care of kids, with a Pew Research Center analysis of Census data finding that in 2016 about 30% of mothers aged 20 to 35 were stay-at-home parents, compared with 6% of fathers — but women similarly gained a lot of ground during the recession and, after losing some of it through about mid-2015, have been gaining again since. This chart that I’ve updated from Smialek’s article also shows that while 25-to-34-year-old women are now just as likely to be employed as those in the 35-44 age cohort, 25-to-34-year-old men are now markedly less likely to be employed than those slightly older.

Finally, here’s an international comparison. The Organization for Economic Cooperation and Development, the club of the world’s affluent democracies, publishes annual estimates of the share of young people who are not in employment, education or training, or Neet. The 14% U.S. Neet share for men aged 20-24 was just slightly higher than the OECD average of 13.4% in 2018, but that average was driven up by a few large economies with major Neet problems, namely France (21%), Spain (23.3%), Italy (27.5%). Here are four countries that had higher young men’s Neet shares than the U.S. in the late 1990s and are all lower or about even with it now.

What’s keeping young American men out of the workforce? Well, that’s the big question. 

In a 2016 commencement speech at the Booth School of Business at the University of Chicago that has since become the target of some mockery in online economics circles, economics professor Erik Hurst proposed that improvements in video games and other electronic amusements might be luring young men to stay home and play rather than look for work. Young men without jobs are certainly spending a lot of time amusing themselves with video game consoles and computers: an average of 12 hours a week among those ages 21 through 30, up from 5.4 hours in the mid-2000s, Hurst and three other economists reported in a subsequent working paper based on data from the American Time Use Survey.

But Gray Kimbrough, a government economist and American University adjunct professor, has found in his own analyses of ATUS data that the rise in time that non-working young men devote to video games has been accompanied by a similar decline in time spent watching television, which suggests that video games are displacing other amusements rather than work. And even Hurst and his co-authors conclude that declining labor demand has played a bigger role than video games in reducing young men’s employment.

Still, there does seem to be a mix of economic and social factors at work here. There are recent economics papers, for example, arguing that less-educated young men’s chances of getting married have declined because it’s harder for them to get good jobs and, conversely, that less-educated young men have become less interested in getting jobs because their chances of marriage have declined. 

The growing number of young men who live with mom and dad is surely the result of forces beyond just a tough labor market. High real estate prices in some parts of the country and big student debt burdens for some young people have made it harder to strike out on one’s own, while larger houses, smaller families and (perhaps) more indulgent parents have made it easier to stay home. Immigrant families have also brought a taste for multigenerational living that had died out among native-born Americans in the 1950s and 1960s. About 37% of 25-year-old men in the U.S. lived with their parents in 2017, according to Kimbrough’s analysis of Census Bureau data, compared with 31% of 25-year-old women — and just 16% of 25-year-old men in 1970.

This living-with-the-parents phenomenon may in turn be partly responsible for what one regular survey indicates is a sharp rise since 2008 in the percentage of men ages 18 to 29 who have never had sex, although evidence on that from other data sources is mixed. It may also ease the pressure on young men to find work. 

Whatever the reasons, there is now a small but larger-than-it-used-to-be minority of American men in their 20s who seem to be making no progress in achieving the markers of adulthood: get a job, move out of the house, get married, have kids. My Bloomberg Opinion colleague Noah Smith this week offered a compelling set of reasons for why it takes longer to get established in careers than it used to, which is delaying things like marriage and homeownership. But what I’m describing seems like a distinct and gender-specific phenomenon, if not a totally unrelated one.

Meanwhile, young women’s labor market gains relative to young men haven’t exactly translated into labor market equality. Women aged 20 through 24 may now be as likely to have jobs as men their age, but they’re less likely to have full-time jobs — partly because more of them are in college, admittedly — and even those who do work full-time are paid less than men. The gender pay gap is smaller for the 20-24 age group than for any other, with full-time female workers earning 90.3% as much per week as their male peers in the third quarter of this year, but it hasn’t narrowed over the past couple of decades.(2)

Young men with jobs are doing OK. It’s the ones who’ve never had one who might be a problem.

(1) College enrollment rates have also fallen recently, and have fallen more among men than among women.

(2) This percentage can jump around a lot from quarter to quarter, and has gone as high as 99% (in the fourth quarter of 2002), but the average since 2000 is 92.4%, and the average for the past five years is 91.7%. Female part-time workers, for whatever it's worth, made slightly more than male part-timers in the third quarter.

To contact the author of this story: Justin Fox at justinfox@bloomberg.net

To contact the editor responsible for this story: Sarah Green Carmichael at sgreencarmic@bloomberg.net

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

Justin Fox is a Bloomberg Opinion columnist covering business. He was the editorial director of Harvard Business Review and wrote for Time, Fortune and American Banker. He is the author of “The Myth of the Rational Market.”

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