Youth Unemployment Act: Creating Stable Job Oportunities
By Sid Salvi '12E
From July 2008 to July 2009, the number of unemployed youth rose by 1 million to 4.4 million, resulting in a youth unemployment rate of 18.5 percent, according to a release by the Bureau of Labor Statistics (BLS) in August 2009. It is the highest that youth unemployment has been since the BLS started tracking it in 1948. This presents a serious problem for the future of this generation. Lack of experience makes finding a job after exiting school an extremely difficult task, lack of income severely limits opportunities and lack of stable future employment promotes delinquency among low socioeconomic status youths. The Office of Management and Budget estimates that a one percent increase in unemployment results in a six to seven percent decrease in initial wages, which remains significant for 15 years. There is an evident need for stable job opportunities for our youth.

The solution suggested here combines both public and private job opportunities in a two-year program. It is crucial to include the private sector since these jobs are more stable but less likely to employ youth. Providing a subsidized opportunity for youth to work within the private sector could reverse this trend. The program would begin in the junior year of high school. Students would choose a particular, specific field to enter, as in a vocational school; however, local companies that elect to participate in the program would provide the classes and work experience during the school year.

Once the program begins, the weekly schedule would consist of two-hour classes taught by an employee of the company and six to eight hours paid hands-on work time in order to provide students with valuable experience. For summer, participating companies will be required to take at least 25 percent of the students in their class as summer hires and provide them with at least 20-hour workweeks. The other students in the class would have the opportunity to apply for government-supplied jobs in their field. These jobs should be used for completion of public projects, ranging from redoing parks to greening public housing to assisting in government offices. Upon re-entry into senior year, students will commence on a similar schedule, except classes will be cut to one hour a week. The newly freed hour will be used for seniors to attend a junior class and talk about their experience in the program — what they have learned, how they have benefited and to give advice. After senior year, the program ends.

Students should be paid for their hours, both during the school year and the summer. Wages for work completed in the school year should be set at minimum wage and provided for by the government for the first year. In the second and third years, participating companies should take on 25 percent and then 50 percent of the wage payments. While this program is not budget neutral in the short term, it does pay off in the long term since higher unemployment results in lower income and thus, lower tax revenues. Also, funding is available through federal stimulus funds set aside for the specific purpose of youth job creation. Furthermore, tax revenue will be incurred from these wages through income taxes and increased consumption.

This program offers incentives for all parties involved: private companies get a head start in training future employees as well as labor for comparatively cheap wages. Students get jobs as well as the potential for stable future employment. The government gets a lower unemployment rate and higher tax revenues as well as a cheap labor force for summer.

This program will require a lot of attention at its beginning, and thus it may be better to start with one or two schools set up as flagship models from which the program can be expanded. The first step should be an assessment of where the most interest lies in such a program, considering the interest both within the school and within local companies. From there, specific details can be discussed once all parties are brought to the table.

Issue 21, Submitted 2010-04-07 03:49:21