Teens face hiring chill as they hunt for summer jobs
- - - Teens face hiring chill as they hunt for summer jobs
Paul Davidson, USA TODAYJuly 1, 2025 at 4:05 AM
The U.S. hiring cooldown is casting a chill over a teen summer job market that has sizzled the past few years.
Fewer teenagers are looking for jobs. And a smaller share of those looking are getting hired.
The development appears to reflect the demise of a post-pandemic hiring frenzy that provided teen summer job hunters the most favorable landscape in more than 50 years, along with benefits experts say can bolster their entire careers.
"If you look at youth unemployment before the pandemic, that's pretty much where we're headed," said Alicia Sasser Modestino, a labor economist at Northeastern University who studies teenage employment.
Is it harder for teens to get jobs now?
Teens are projected to gain 1 million jobs in May, June and July, the lowest tally since 2010, according to estimates by outplacement firm Challenger, Gray & Christmas.
Among other factors, experts point to a generally slowing U.S. labor market, economic uncertainty spawned by President Donald Trump's tariffs and automation that's wiping out the kind of entry level jobs typically snared by young people.
Sorting shelving displays at stores like this Walmart Super Center in Compton, California, U.S., is a popular summer job for teens
The Labor Department on Thursday is expected to report a tepid 113,000 job gains for June, down from 139,000 the previous month.
Small businesses are still bringing on a healthy share of teenagers for summer jobs, according to Gusto, a payroll processor for small firms. Nineteen percent of their clients' new hires in May were 15- to 19 years olds, similar to the 18.3% in 2023 and 19.1% in May 2024.
But total employment for that age group was up 11.8% from a year earlier, compared to a 14.3% annual rise in May 2024.
"The companies that rely on teens are still hiring teens," said Gusto Senior Economist Nich Tremper. "However, a declining hiring rate has effects throughout the economy."
Labor Department data reveals a more dramatic drop-off in teen hiring.
What percent of teenagers have a summer job?
The share of 16- to 19-year-olds working or looking for jobs fell to 35.4% in May from 37.4% a year earlier - the lowest May level since the depths of the pandemic in 2020, according to Bureau of Labor Statistics' non-seasonally adjusted figures.
Marquise Shiemvs, manager of Chip City, a cookie shop in Arlington, Virginia, said most of of the shop's seven employees are high school students, but finding them has gotten tougher.
Unlike in prior years, "They're really not coming in and putting in applications," Shiemvs said. Instead, the shop has recruited one or two teen customers to join the staff.
Youths who are searching for work are struggling. The teen unemployment rate rose to 13.1% last month from 12.1% a year earlier, the highest May mark since 2020. Unemployment overall was at a historically low 4.2%.
About 5.5 million teens were employed last month, the lowest May tally since 2022.
For decades, a summer job served as a rite of passage, with 55% of teenagers working or job hunting in May 1979. The share tumbled to 32% to 34% through the 2010s as many teens instead got involved in school activities and volunteer work to bolster their resumes for college or took gig jobs not tracked by Labor, according to Modestino and the Society for Human Resource Management.
How did COVID-19 impact employment?
COVID-19 changed everything.
As the economy reopened in 2021, restaurants, hotels, shops and amusement parks frustrated by pandemic-related labor shortages turned to young people to fill an abundance of openings and meet a surge of pent-up consumer demand.
High school and college students stuck at home during COVID-19 lockdowns itched to get out and fill many of the vacancies. They were also drawn by soaring pay as businesses scrambled to attract scarce job candidates, especially for in-person roles. Median annual wage growth for 16- to 24-year-olds climbed from about 8% in the summer of 2020 to 13% in summer 2022, according to 12-month averages figured by the Federal Reserve Bank of Atlanta.
In May 2021, the teen unemployment rate fell to 9.5%, lowest since 1953, and hovered near a historically low 10% the following two summers. By May 2024, the share of teens working or looking for jobs hit 37.4%, highest since 2009.
For teens, a summer job teaches soft skills such as "how to work, in addition to how to do a job," Tremper said. "Just showing up on time and navigating dealings with colleagues."
Added Modestino, "These short-term gains over the summer are linked to long-term reductions in criminal justice involvement, improvements in high school graduation rates and increased employment and wages up to four years later."
But several factors are coalescing to suppress teen hiring.
A softening economy and job market
Last year, businesses pulled back on hiring broadly as a post COVID-19 spike in demand faded but labor costs and interest rates stayed high. The drop-off has intensified this year as Trump's tariffs have spawned business uncertainty about a potential leap in costs in coming months.
Average monthly job growth has tumbled from 168,000 in 2024 to 124,000 this year.
Consumer sentiment, meanwhile, generally has plunged despite a partial rebound in June as Americans worry about a tariff-related resurgence of inflation. U.S. household spending is weakening, especially for discretionary services such as travel and hospitality, Oxford Economics said in a research note last week, adding that many foreign visitors are also shunning the U.S. because of the import fees. Such sectors typically employ lots of teens in the summer.
In May, consumer spending fell 0.3% after adjusting for inflation, with declines of 1.1% for airfares and 0.6% for recreation services, and a meager 0.1% rise for hotel stays, according to Commerce Department figures released last week.
"The leading edge of the cooling labor market is teens," Modestino said, noting they have less work experience than other age groups. "Teens are the last to be hired and the first to be fired."
Before the health crisis, the summer unemployment rate for teens hovered at about 13%, compared to 3.6% for all workers.
Competition from recent college grads, adult workers
With hiring slowing broadly, teens are vying for summer jobs with recent college graduates as well as older adults, Tremper and Modestino said. Although companies are still hesitant to lay off workers because of the pandemic's labor shortages, those who are cut or just entering the labor force are taking longer to find positions.
Through the first four months of the year, the number of 20- to 24-year-olds who are long-term unemployed (jobless at least six months) is up 32% compared to the same period in 2019, Labor figures show.
Automation
Retailers are deploying more self-serve checkout registers and other technologies, providing fewer opportunities for teens, Modestino said. Artificial intelligence, she said, isn't yet taking a significant toll but could in coming years, she said.
Immigration
Immigration is declining amid the Trump administration's massive deportations of migrants who lack permanent legal status. Under looser Biden administration policies, net immigration to the U.S. surged to 2.6 million in 2022 (the 12 months ending in June 2022), 3.3 million in 2023 and a projected 2.8 million in 2023, according to the Congressional Budget Office. That compares to an annual average of about 900,000 from 2010 to 2019.
But by fourth quarter, the total is expected to plummet to an annualized rate of 500,000, according to Oxford Economics.
That theoretically should mean less competition for teens for the kind of restaurant, hotel and other hospitality jobs that some immigrants occupy.
But Oxford says it takes time for of recent foreign arrivals to find jobs. For now, the labor supply is still being boosted by the immigration surge of the past few years, the research firm said.
Some analysts said immigration's impact on the teen summer job market is mixed. Some recent migrants from Latin American countries who otherwise would seek restaurant and hospitality jobs are laying low because of the administration's immigration raids, Modestino said. The labor force participation rate for Hispanic teens was at 32.4% in May, down from 35.7% a year earlier, she noted.
But a 2022 study by the Journal of Population Economics found that when arrests of Hispanic migrants increase, labor force participation falls among Hispanic adults but rises sharply among their U.S.-born teen children who try to replace some of their income.
"With the increased rhetoric against immigrants and recent actions of ICE, we may see a surge in teen employment in this population this summer," said Andrew Challenger, senior vice president at Challenger, Gray & Christmas.
This article originally appeared on USA TODAY: Teens grapple with cooling job market
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