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Teenage employment has bounced back

Summary:
Matt Yglesias directed me to a graph showing that teenage employment has bounced back to near pre-Covid levels: This surprised me, as prime-age employment remains depressed at levels well below early 2020: What explains the difference?  There are many potential explanations, but one possibility is that teenagers are less likely to be receiving generous unemployment benefits, as many of them were not working when the Covid recession hit last March, or had not worked long enough to qualify.  What are some other theories? If I’m right, then prime age employment should bounce back after the extra 0/week benefits expire in early September. PS.  It’s true that in an absolute sense the teenage employment ratio is quite low, but it was also low in 2019 when the

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Matt Yglesias directed me to a graph showing that teenage employment has bounced back to near pre-Covid levels:

Teenage employment has bounced back

This surprised me, as prime-age employment remains depressed at levels well below early 2020:

Teenage employment has bounced back

What explains the difference?  There are many potential explanations, but one possibility is that teenagers are less likely to be receiving generous unemployment benefits, as many of them were not working when the Covid recession hit last March, or had not worked long enough to qualify.  What are some other theories?

If I’m right, then prime age employment should bounce back after the extra $300/week benefits expire in early September.

PS.  It’s true that in an absolute sense the teenage employment ratio is quite low, but it was also low in 2019 when the economy was booming and jobs were plentiful.  Today, teenagers are less likely to choose to work than back in the 20th century, when teen participation rates were higher.  Many teens now participate in extensive extracurricular activities to boost their chances of getting into a good college.  (I worked in a canning factory when I was 17.)

Scott Sumner
Scott B. Sumner is Research Fellow at the Independent Institute, the Director of the Program on Monetary Policy at the Mercatus Center at George Mason University and an economist who teaches at Bentley University in Waltham, Massachusetts. His economics blog, The Money Illusion, popularized the idea of nominal GDP targeting, which says that the Fed should target nominal GDP—i.e., real GDP growth plus the rate of inflation—to better "induce the correct level of business investment". In May 2012, Chicago Fed President Charles L. Evans became the first sitting member of the Federal Open Market Committee (FOMC) to endorse the idea.

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