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Here’s a fact that should give economists — and maybe President Obama’s political team — heartburn: Two years after the Great Recession officially ended, job prospects for young Americans remain historically grim. More than 17 percent of 16-to-24-year-olds who are looking for work can’t find a job, a rate that is close to a 30-year high. The employment-to-population ratio for that demographic — the percentage of young people who are working — has plunged to 45 percent. That’s the lowest level since the Labor Department began tracking the data in 1948. Taken together, the numbers suggest that the U.S. job market is struggling mightily to bring its next generation of workers into the fold.
This is a dangerous proposition, economically (for the United States as a whole) and politically (for the president).
As The Atlantic‘s Don Peck wrote last year, citing a litany of research from Yale University’s Lisa Kahn, college graduates who enter the labor force during a recession make significantly less money — in their first year and over the course of their careers — than grads who walk into an economic boom. Workers stuck in the unemployment line for an extended period risk watching their skills atrophy and face increasing difficulty finding new jobs. That’s particularly true, though, for people waiting and waiting and waiting to land their first job. The longer a whole batch of fledgling workers sits waiting to be hired, the more the economy risks losing young employees with valuable, high-end skills at a time when global competition is increasingly fierce.
Snowballing youth unemployment feeds social unrest. Exhibit A is the Middle East. Exhibit B is Europe’s periphery; in such countries as Spain, Greece, and Croatia, more than one in three young people is unemployed, a problem that The Economist magazine warned this week is “as great a challenge for these governments as protecting their tottering banks and slashing their budget deficits.”
Not surprisingly, polls suggest that America’s young people have grown more pessimistic about the economy and their own future fortunes. Generation Opportunity, a nonpartisan, nonprofit youth-outreach group headed by former Bush administration official Paul Conway, compiled polling data this summer showing decayed economic confidence among the so-called millennials: More than half say that the United States is seriously on the wrong track, and a similar number say they are not optimistic about the nation’s economic future. More than half also assert that they’re not confident that the country will be the global economic leader in 10 years. More than three-quarters say that, given the current state of the economy, they have delayed or will delay buying a home, paying down student debt, obtaining more education, saving for retirement, changing jobs or cities, getting married, or making some other major life decision.
Young voters stampeded to the polls for candidate Obama in 2008, topping their 2004 turnout by more than 3 million and breaking, 2-to-1, in his favor. A drop in youth participation, or a shift toward a GOP candidate, could complicate Obama’s reelection dramatically.
Generation Opportunity’s pollster, Kellyanne Conway, who has worked for several national GOP politicians in the past, says that young voters will be tougher on Obama in 2012 than they were in 2008. “The big question for young people [in 2008] was, “˜How am I going to help you make history?’ “ says Conway, who is not related to the group’s president. “The big question from young people today is, “˜How are you going to help me find a good-paying job?’ “ This time, she adds, “they’re looking for tangibles.”
Conway’s polling suggests that young voters could sympathize with a Republican message on cutting federal spending and the budget deficit. Three-quarters of millennials want to see federal spending reduced, she says, and three in five want to reduce the deficit through spending cuts rather than tax increases. Two-thirds say that Social Security dollars are safer “under your pillow” than with the government. Paul Conway, the group’s president, says that’s “fair warning” to Obama about how young voters view his policies.
Other polls suggest more-favorable attitudes toward the president. In a late-June Gallup survey, 56 percent of Americans ages 18 to 29 approved of Obama’s performance, the highest approval rating of any age bracket. Team Obama sounds unconcerned about losing young voters. Campaign officials note that thousands more of them applied to be summer campaign organizers this year than did in 2008. “In addition to what he has already accomplished on issues of importance to them — like establishing a tax credit to provide tuition relief to students and extending health insurance coverage to young adults up to the age of 26 — young Americans have seen the president bring the economy back from the brink of depression and secure investments in education, research and development, and clean energy that are creating jobs today that will remain globally competitive in the future,” campaign spokesman Ben LaBolt said in an e-mail.
Obama and Republicans alike should pay particular attention to youth optimism about the direction of the economy. In 2008, exit polls showed that 54 percent of young voters believed that the economy would improve over the next year, compared with 47 percent of the rest of the electorate. Obama probably needs millennials to be similarly upbeat in 2012. In other words, it’s all about confidence — like so much else in the economy these days.