What's Really Happening with America's Out-of-School Youth?
A Forum — April 18, 1997
Overview
Today's forum provided participants with a frank assessment of the economic situation of America's out-of-school youth and how this affects the long-term prospects of the U.S. economy. Andrew Sum, Director of the Center for Labor Market Studies at Northeastern University presented staggering statistics regarding the labor market experiences of out-of-school youth ages 17 to 24, a comparison of the earnings of young people who have attained various levels of education, the changing demographic composition of this population and strategies for improving their labor market prospects. Marion Pines, Senior Fellow at the Johns Hopkins University Institute for Policy Studies, joined Sum to provide additional strategies developed through years of experience working with programs directly serving young people.
The Labor Market Situation
Sum outlined a series of statistics demonstrating the difficulties out-of-school youth face in achieving economic success. Young people ages 17 to 24 who have not graduated high school face a much more difficult time obtaining employment than their more educated peers. Nearly 50 percent of these young people are unemployed or hold low paying (weekly wage below $300) part- or full-time jobs. Employment opportunities are even more limited for black and Hispanic youth. The full-time employment rate of white high school dropouts is 38.3 percent, while for black high school dropouts it is only 22.4 percent.
Wage data show that even those who obtain jobs are earning extremely low wages. Only 36.1 percent of white high school dropouts who are employed full-time earn a salary above the poverty line. More troubling is that only 6.8 percent of black high-school dropouts working full-time reach this level of income. Such wage problems are not limited to out-of-school youth, as the median weekly earnings of all male employees ages 17 to 24 have dropped from 74 percent of the wages of workers 25 and older in 1967 (93.7 percent for women) to 51.2 percent in 1996 (64.2 percent for women). This has resulted in a 31 percent overall decline in real weekly earnings of young men under 25 since 1975 (a 17.2 percent decline for women).
Data further show that employment rates and wages increase significantly with each additional level of educational attainment. The full-time employment rate of white high school graduates ages 17 to 24 is 62.9 percent (53.1 percent for blacks), much higher than the rate for dropouts. For college graduates, the full-time employment rates increase to 83.2 percent--more than two times the rate for high school dropouts. Similarly, 51.4 percent of high school graduates ages 17 to 24 earn a salary above the poverty line (28.2 percent for blacks), well above the rate for high school dropouts. Again, college graduates are most successful, with 74.2 percent of full-time workers earning a salary above the poverty line, also more than two times the rate for high school dropouts.
Demographics and Their Societal Impact
These statistics take on even greater importance as data indicate that by the year 2010, the 18 to 24 year old population will be 20 percent larger than it is today. The largest growth will be among minority populations--the young people hit the hardest economically over the past 30 years. As the wage gap between those with more education and less education widens, improving the education system and expanding educational will become even more important.
Pines outlined strategies that can enhance the educational and economic outcomes of out-of-school youth. While there are many strategies and programs designed to help young people, there is no systemic method of connecting the myriad interventions. There are, however, key principles which research has shown to positively affect young people:
- A sustained connection to the workforce
- The presence of community-based alternative learning environments
- Continuous attention from caring adults
- Connections to other support systems, such as health care and housing
- Incentives to change their behavior
While these principles provide a framework for serving the needs of the nation's out-of-school youth, many established programs focus on in-school youth. Pines proposed expanding the in-school school-to-work model at the community level to create a new type of school-to-work system, one with different venues for service delivery. This new system would organize networks of businesses to serve in-school and out-of-school youth; provide out-of-school youth with a "homeroom," or base; obtain public school funding that currently does not "follow" high school dropouts to alternative learning environments; and go beyond GED preparation to prepare youth for jobs and additional education, perhaps through partnerships with community colleges.
Both Sum and Pines stressed that there is no "one answer" to solving the problems facing out-of-school, but the data on their labor market outcomes and the track record of successful youth interventions highlights the need for policymakers to address this pressing issue. Waiting, however, will only make the current situation worse, as the number of young people in the U.S. grows to unprecedented heights over the next two decades.