Tracking youth joblessness: persistent or fleeting?, (EXCERPT), Monthly Labor Review Online, February 1982

Tracking youth joblessness:
persistent or fleeting?

Norman Bowers

Many studies have focused on differences between youth and adults in job and labor force turnover in attempts to account for the fact that youth unemployment is always higher than that of adults. However, some recent research suggests that the observed age-related differences in the incidence of joblessness are misleading indicators of the dynamics of youth unemployment. While frequent turnover is admittedly a feature of the youth labor market, the core of joblessness may in fact be accounted for by a relatively small number of persons who search for jobs for very long periods.¹

A new study of matched data from the Current Population Survey examines the unemployment experience of selected individuals in the course of a year, and over 2 consecutive years. The findings suggest that:

Prolonged joblessness is somewhat concentrated among a relatively small group of workers but is also strongly affected by the business cycle.
A clear association exists between the extent of past joblessness and the likehood of subsequent unemployment.
Two or more spells of joblessness in one year do not necessarily presage similar unemployment the next year.
Recurrent unemployment is no respecter of age, striking all labor force groups.

The analysis exploits the short-run longitudinal capabilities of the Current Population Survey, which permit construction of a 2-year retrospective labor force history of persons in the sample. This previously untapped data set allows some examination of the following important questions: Is the experience of extensive unemployment in one year associated with extensive unemployment in the following year? How important are repeat spells of unemployment? And, are persons with multiple spells of unemployment in one year more likely than others to experience spells in the subsequent year?

Of course, 2 years is a relatively short time in terms of labor force history, and no definitive analysis of what has been called the "scarring effect" of persistent youth joblessness is possible.² Still, the questions that can be addressed are of interest in their own right.

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Footnotes

1 A critique of much of the relevant literature is contained in Norman Bowers, "Young and marginal: an overview of youth employment," Monthly Labor Review, October 1979, pp. 4-16. A turnover perspective and an implicit critique of that approach can be found in Jacob Mincer and Linda Leighton, "Labor Turnover and Youth Unemployment," and Kim Clark and Lawrence Summers, "The Dynamics of Youth Unemployment" in Richard Freeman and David Wise, eds., The Youth Unemployment Problem: Its Nature, Causes, and Consequences (Chicago, University of Chicago Press, 1981). Also see Joseph Antos and Wesley Mellow, "The Youth Labor Market: A Dynamic Overview," BLS Staff Paper II (Bureau of Labor Statistics, 1979).

2 For example, this article will not discuss the potential impact of unemployment on subsequent wages (and growth in wages) or career prospects. See Brian e. Becker and Stephen M. Hills, "Teenage Unemployment: Some Evidence of the Long Run Effects on Wages," Journal of Human Resources, Summer 1980, pp. 354-72; David Ellwood, Teenage Unemployment: Permanent Scars or Temporary Blemishes," in Richard Freeman and David Wise, eds., The Youth Unemployment Problem: Its Nature, Causes, and Consequences (Chicago, University of Chicago Press, 1981). Also see Joseph Antos and Wesley Mellow, "The Youth Labor Market: A Dynamic Overview," BLS Staff Paper II (Bureau of Labor Statistics, 1979).

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