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While the unemployment rate has been at or below 4% for 30 months — a near record — not everyone who wants a job has one. And not everyone wants a job at all.
Some of them, the so-called 'NEETs' (which stands for 'not in employment, education, or training'), drop out of the labour market because they feel discouraged by their economic situation.
Others, however, are well-qualified but often younger candidates who struggle to find jobs and form a contingent of the “newly unemployed,” according to a recent report by Korn ferry.
Among 16- to 24-year-olds, the unemployment rate rose to 9% in May, which is “typical,” said Alí Bustamante, a labor economist and director of the Worker Power and Economic Security program at the Roosevelt Institute, a liberal think tank in New York City.
While the youth unemployment rate fell below 7% in 2023, according to the U.S. Bureau of Labor Statistics, such lows were “indicative of how overheated the labor market was at the time,” Bustamante said.
“9% is about what we would expect for younger workers in relatively good economic times,” he added.
'NEETS' feel 'left out and left behind'
Yet in the US there are still young people who are neither working nor learning new skills.
According to the International Labor Organization, approximately 11.2% of young adults aged 15 to 24 in the US were considered NEET in 2023.
In other words, about one in 10 young people are “excluded and left behind in all kinds of ways,” Bustamante said.
Even though that is “normally the norm”, he said, “we should expect these percentages to be lower.”
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According to Julia Pollak, labor economist at ZipRecruiter, young men in particular are becoming less engaged in their work.
“The NEET trend is primarily a male phenomenon,” she said.
Pollak explains that this is partly due to declining opportunities in traditionally male occupations such as construction and manufacturing, while “women's participation in schooling, educational outcomes and employment outcomes are generally on an upward trend.”
'Talent hoarding' has led to 'new unemployed'
According to the Korn Ferry report, a “perfect storm” has also created a glut of “newly employed,” or highly educated workers struggling to find jobs.
“Employers are holding on to the talent they have and increasingly focusing on talent mobility,” said David Ellis, senior vice president of global talent acquisition transformation at Korn Ferry.
According to him, this 'hoarding of talent' has led to fewer vacancies, even for well-qualified candidates.
At the same time, companies are scaling back their hiring, which also limits the entry-level options.
While the employment rate among teens is at its highest in more than a decade, those in their early 20s are struggling to find jobs, Pollak said. “It’s the 20- to 24-year-olds who saw a huge drop in labor force participation during the pandemic, and who have fallen behind since then.”
Overall, recruitment forecasts for the 2024 class are down 5.8% from last year, a report from the National Association of Colleges and Employersor NACE.
With more candidates competing for fewer positions, unemployment spells are also getting longer. Now, the number of people unemployed for more than six months has increased by 21 percent, Korn Ferry found.
From 'unworkable' to workable
Despite these labor market trends, “all is not lost,” Ellis said.
“Don’t wait to reach out,” he advised. Reconnect with former employers or colleagues via LinkedIn or email and schedule informational interviews. After that initial approach, ask about any openings or contacts.
In the meantime, make yourself more visible by writing about notable topics in the industry and Update your resume with keywords and so-called 'title tags', which emphasize important elements at the top.
Finally, don’t limit yourself to roles that offer a promotion or a raise, Ellis also advised. Instead, aim for a “career grid,” which might mean taking a lower position to gain skills that will pay off later.
