Teen Unemployment and the Minimum Wage

Unemployment is a major topic of concern throughout the nation, but one aspect of this issue often overlooked is the plight facing teens. While Idaho’s overall unemployment rate remains uncomfortably high, Idaho’s teen unemployment rate is several times higher. In addition to this disturbingly high unemployment rate, teens are facing reduced hours and many have abandoned the goal of employment altogether.

There may well be multiple reasons why unemployment has risen so quickly among teens, but the one that cannot be overlooked is the rapid increase of the minimum wage. Between 2007 and 2009 the federal minimum wage increased from $5.15 an hour to $7.25 an hour. This represented a 41 percent increase during a period that included the beginning of a major economic downturn. It is unsurprising that such a dramatic increase in the baseline cost of labor led to an equally dramatic decline in the demand for it.

You can read the full report here.

2 Responses to “Teen Unemployment and the Minimum Wage”

  1. Wayne Harper 17 July 2012 at 9:11 AM #

    Over the years I have worked with lots of small businesses as an accountant .. well bookkeeper and tax preparer … it’s agains the rules and regs to call my self and accountant … back to the topic . small business have simply not hired people at the elvated rate of $7.25 an hour .. when the minimum wage went to $7.25 the real winner was the bureaucrats with increased payroll taxes .. the losers were the teens … and low income workers …