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Although the unemployment rate has spent 30 months at or below 4% – a near record – not everyone who wants a job has one. And not everyone even wants a job.
Some, referred to as “NEETs,” meaning “not in employment, education or training,” choose to drop out of the workforce largely because they are discouraged by their financial position.
Others, alternatively, are well-qualified but often younger candidates struggling to find jobs, making up a pool of “young unemployed”, according to a recent report by Korn Ferry.
Among 16- to 24-year-olds, the unemployment rate rose to 9 percent in May, which is “typical,” according to Alí Bustamante, a labor economist and director of the Worker Power and Economic Security program at the Roosevelt Institute. liberal think tank based in New York.
Although the youth unemployment rate fell below 7 percent in 2023, according to the U.S. Bureau of Labor Statistics, such lows were “emblematic of how hot the labor market was at that point,” Bustamante said.
“9% is basically what we should expect in relatively good economic times for younger workers,” he added.
“NEETS” feel “abandoned and left behind”
However, some young adults in the US are neither working nor learning new skills.
In 2023, about 11.2% of young adults aged 15 to 24 in the US were considered NEETs, according to the International Labor Organization.
In other words, about one in 10 young people “are left out and left behind in many ways,” Bustamante said.
While “this is usually the norm,” he said, “we should expect these rates to be lower.”
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Young men, especially, are increasingly disengaged, according to Julia Pollak, labor economist at ZipRecruiter.
“The NEET trend is predominantly a male phenomenon,” he said.
Pollak explained that this is partly due to declining opportunities in traditionally male occupations such as construction and manufacturing, while “women’s school enrollment, educational outcomes and employment outcomes are mostly on the rise.”
‘Talent hoarding’ has led to ‘young unemployed’
According to the Korn Ferry report, a “perfect storm” has also created a glut of “young unemployed,” or highly educated workers struggling to find job opportunities.
“Employers are holding onto talent and increasingly focusing on talent mobility,” said David Ellis, senior vice president of global talent acquisition transformation at Korn Ferry.
This “talent hoarding” has led to fewer jobs available even for well-qualified candidates, he said.
At the same time, companies are cutting back on new hires, limiting entry-level opportunities as well.
While the teen employment rate is the highest it has been in more than a decade, 20-somethings are struggling to find work, Pollak said. “It’s the 20- to 24-year-olds who saw a huge drop in labor force participation during the pandemic and who have been lagging behind ever since.”
Overall, hiring projections for the class of 2024 are down 5.8 percent from last year, according to report from the National Association of Colleges and Employersor NACE.
As more applicants compete for fewer jobs, unemployment segments also lengthen. Now, the number of people unemployed for more than six months has increased by 21%, Korn Ferry found.
“Unemployed” to employable
Despite these labor market trends, “all is not lost,” Ellis said.
“Don’t wait to reach out,” he advised. Reconnect with former employers or colleagues via LinkedIn or email and set up informational interviews. After this initial approach, ask for any job leads or contacts.
In the meantime, make yourself more visible by writing about notable topics in the industry and updating your resume to include keywords and so-called “title tags,” which highlight important items at the top.
Finally, don’t limit yourself to roles that involve a promotion or raise, Ellis also advises. Instead, aim for a “career grid”, which could involve taking a lower position to gain skills that will pay dividends later.
