Young Workers Without Postsecondary Degrees to be Hit Hard by Economic Turmoil

Posted May 12, 2020, By the Annie E. Casey Foundation

Young parent with child during pandemic

The eco­nom­ic cri­sis spurred by the coro­n­avirus pan­dem­ic will hit young work­ers espe­cial­ly hard, par­tic­u­lar­ly those with­out a col­lege degree who are not in school, accord­ing to an analy­sis by the Brook­ings Insti­tu­tion.

Sta­tis­tics about young workers

Before the pan­dem­ic, more than half of the 13 mil­lion work­ers in low-wage jobs aged 18 to 24 did not have an asso­ciate or bachelor’s degree and were not pur­su­ing one, accord­ing to the Casey-fund­ed analy­sis. Some 46% of those young work­ers with­out degrees — with medi­an hourly wages of $10.22 — were employed in indus­tries that have large­ly been shut­tered due to stay-at-home orders and social-dis­tanc­ing mea­sures, includ­ing hos­pi­tal­i­ty, pub­lic trans­porta­tion, accom­mo­da­tions and restau­rants and bars.

Anoth­er 20% of these young work­ers with­out degrees were in indus­tries at risk of decline as house­holds reduce spend­ing, such as con­struc­tion, man­u­fac­tur­ing and real estate, which have start­ed to see high­er shares of lay­offs in recent weeks.

Young work­ers with­out a degree who earn low wages are diverse: 51% are white, 27% are Lati­no and 16% are black. About one-third had attend­ed some col­lege or work train­ing but did not earn a degree, poten­tial­ly putting them in the posi­tion of pay­ing back stu­dent debt that has pro­vid­ed them with lit­tle eco­nom­ic payoff.

It’s obvi­ous that long-term issues, includ­ing racial dis­par­i­ties pro­duced by our employ­ment and edu­ca­tion sys­tems, have played a major role in deter­min­ing which work­ers are affect­ed most by the pan­demic’s eco­nom­ic tur­moil,” says Alli­son Ger­ber, a Casey Foun­da­tion senior asso­ciate. We hope that law­mak­ers, employ­ers, phil­an­thropists and oth­ers involved in the response to this cri­sis take into account these long­stand­ing issues and pro­vide appro­pri­ate sup­port to those most in need.”

Young work­ers with a post­sec­ondary cre­den­tial also are over­rep­re­sent­ed in indus­tries that are at risk, though they may face a bet­ter chance of find­ing alter­na­tive employ­ment, accord­ing to Martha Ross and Nicole Bate­man, the researchers behind the analy­sis. Still, many are like­ly to strug­gle, as many young col­lege grad­u­ates did fol­low­ing the Great Reces­sion, the researchers say.

Call for a fed­er­al­ly fund­ed employ­ment initiative

To aid young, low-wage work­ers — and the rest of the 53 mil­lion Amer­i­cans who earned low wages before the pan­dem­ic — Ross and Bate­man rec­om­mend Con­gress cre­ate a fed­er­al­ly fund­ed employ­ment ini­tia­tive that:

  • employs mil­lions of peo­ple for at least three years; and
  • tar­gets young work­ers and those with a range of expe­ri­ence and edu­ca­tion­al back­grounds who will face chal­lenges find­ing work.

Ross and Bate­man sug­gest expand­ing pro­grams that cater to young work­ers, such as Youth­Build or Ameri­Corps. A fed­er­al ini­tia­tive could also place peo­ple in employ­ment that aids the pan­dem­ic response, such as mak­ing pro­tec­tive equip­ment for health-care work­ers, orga­niz­ing food dri­ves and deliv­er­ing groceries.

Reach­ing mil­lions of peo­ple over sev­er­al years will require hun­dreds of bil­lions of dol­lars,” Ross and Bate­man write. We must not flinch at the price tag. We should cal­i­brate our response to the scale of the prob­lem, and not use the size of exist­ing employ­ment-relat­ed fund­ing streams as the benchmark.”

Learn about efforts to improve job prospects for young adults

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