Comment by StevePerkins | Hacker News Reader

Comment by StevePerkins | Hacker News Reader

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I wonder why so many financial publications, who supposedly know a thing or two about economics, sound so woefully ignorant when contemplating the behavior of younger generations?

"Millennials are buying fewer cars and houses. Does their 'culture' favor non-ownership?"

No... they have higher levels of student load debt than previous generations, and lower income prospects due to stagnating wages. Almost everyone I know who DOES get a high-paying job eventually winds up buying a car and house.

"Fewer teenagers are working jobs. Are they more lazy?"

No... there are more unemployed adults these days, who are forced into the restaurant and retail jobs traditionally filled by teens. As professionals in the financial industry, surely you understand well enough that the official "unemployment rate" does not reflect the true "labor participation" rate.

Is all of this willful ignorance? Or are financial writers not researching and thinking anymore?

The actual article does indeed address most if not all of the exact issues you just raised, for example:

Why aren't teens working?... They're being crowded out of the workforce by older Americans, now working past 65 at the highest rates in more than 50 years. Immigrants are competing with teens for jobs... College-bound teens aren't looking for work because the money doesn't go as far as it used to.

Perhaps the headline is asking a "willfully ignorant" question; but the reason is to get you to click through to the article, which does seem to be trying to put forth some theories.

It also points out that more teens are in school during the summer. I certainly was, and that was many years ago.

Also, I can't resist griping about this:

> The U.S. unemployment rate fell to 4.3 percent in May, the lowest in 16 years, ...

The article later discloses that the labor force participation rate is now about 63%. And it hasn't recovered at all since 2008. It's just plateaued.

Here's an online tool to explore the labor force participation rate over the past several decades: https://data.bls.gov/timeseries/LNS11300000

Since 1970, the rate has varied between 60% and 67%. It peaked at around 67% in 1998 and is currently around 63%.

Thanks.

It hovered around 60% until 1970, and then increased, hitting about 67% in 2000. I'm guessing that reflected increasing paid employment of women, at least in part. Since 2000, it's dropped, plateauing at around 66% until 2008, and then plateauing at around 63% since 2012.

With the caveat that for anyone actually looking for a nuanced article, that headline is far more likely to cause them to dismiss it than to click through. But I suppose there will always be other information sources targeting that demographic, with titles along the lines of "Emergent incentive structures for labor participation of middle class teens in labor over-supplied developed economies"[1], or something of the sort.

[1] Entirely fictitious title, was too millennial and lazy to find a proper article studying this ;)

I'm surprised there's no mention of the minimum wage pricing teenagers out of the market.

That's because the buying power of the minimum wage has been getting lower over time, while teenage employment has been going down. It's not the reason teenagers aren't working.

A lot of these arguments about retirees taking minimum wage jobs and all that is simply increased supply of labor which should push wages down. But they can't possibly go down below the minimum wage. Remember, the minimum wage is just the legal requirement that employers prejudice against the least productive members of the work force. If minimum wage is $10/hr but your fair market wage is $5/hr, you're unemployed.

Teenagers don't work summer jobs for spectacular buying power, they usually work for experience. In most modern jobs, however, there's hardly any way an inexperienced part-time teenager can add value quantified at or above minimum wage levels.

Why? It has nothing to do with it.

Minimum wage is the single greatest cause of unemployment on the lower end of the salary/productivity spectrum. If you have $5/hr worth of productivity but minimum wage is $10/hr, then you're unemployed.

Not necessarily. See this Cornell study re the restaurant industry. http://scholarship.sha.cornell.edu/chrreports/2/

a rhetorical question - very useful for getting one's point across.

If you acknowledge a political problem, the next logical step is proposing a political solution.

If you are ideologically incapable of agreeing with the latter, it will affect your ability to recognize the former.

There is that quote about a man believing or not believing something if his salary depends on it ...

Your experience is very unevenly distributed, at least for the second item. Around here, restaraunts, car washes, and retailers will hire anyone, they all have signs up. The car wash starts at $15/hr...good teenager money. I was just speaking to a an established restaurant owner who is raising menu prices so he can try to pay more to keep bus boys and servers as the market is so competitive. Which is what would be expected in a tight labor market. I do not see a lack of retail and restaurant jobs, or those jobs being taken by old people.

what is the opportunity cost of spending all that time washing cars though? If you don't need the resources I think there are better ways to spend your formative years

One summer as a teen I worked a maintenance job at a family owned warehouse. It involved pouring asphalt, shoveling gravel, and cleaning warehouse walls.

This was in Southern Illinois mind you so it was blazing hot and humid everyday. The dust from the warehouse walls would aggravate my allergies and send me off on sneezing fits. I hated every second of it.

This work made me appreciate how important it was to go to college do well in school. It also made me appreciate the "hard work" people do that goes unnoticed.

My longest "hardest" days as a Software Engineer in SF do not compare to that maintenance job. I did not gain much financially but I did learn a lot about endurance.

Tell that to my 16 year-old. He's bored sitting around the house and actively sought out a job. Now he gets to hang out with people he likes and is paid for it.

Opportunity cost $0

Where are you?

Parent is 45 minutes from San Francisco in the direction of wine country, based on HN posting history.

So... not representative of most of the US.

My counties unemployment rate is slightly lower than the overall US unemployment rate. Not much.

I was thinking more about the local cost of living than the unemployment rate. I suspect teenagers can get $15/hr jobs in counties near NYC, too.

They can't get that much in places like Indianapolis, Pittsburgh, Birmingham, or Memphis, though.

Yes thats fair, so far as whether $15 sounds like a lot, or teenager pocket money kind of money.

> there are more unemployed adults these days, who are forced into the restaurant and retail jobs traditionally filled by teens.

While I generally agree with that thesis, everywhere I go in the USA I see an abundance of job openings at those levels. Help wanted signs are literally everywhere.

Unemployment is at 4%, which is nearly full employment - yes there is a separate wages problem too, but right now nearly nationwide there are huge numbers of job openings for low skilled work.

The labor participation rate is the lowest it's been since the 70s when we largely didn't allow women to work. The 4% unemployment rate is missing a lot of the story.

Maybe the rhetoric has shifted now that the administration was changed, but the last time I checked, the labor participation rate was largely attributable to:

* Retiring baby boomers

* Married women not needing to work

* Young, work-eligible adults are in college, not employed

* Robust-enough welfare that work is optional

Aside from the latter, I don't know that any of the above are cause for concern.

I'd like to see more data that counteracts the data I keep seeing:

1. Baby boomers are not retiring at the levels previously expected, and they're not retiring (and slowing down promotions for juniors).

2. Marriage rates are lower than ever. Single parent households are becoming a new norm.

3. Too many college graduates have experienced low salaries or poor job prospects compared to expectations (and now they're defaulting on their loans!)

4. Welfare/transfers are not enough and mostly go to those already in jobs, subsidizing the low wages. (The Walmart class, etc.)

Now we have political instability and that's not a cause for concern?

I wasn't meaning to imply that political instability isn't a cause for concern, but I wasn't referring to the introduction in my conclusion, just the listed points.

Also, for what it's worth, I didn't intend to refer to it as political instability, rather, just the usual situation in which one administration explains uncomfortable facts differently from another.

I have no idea what Trump's response to it would be, but IIRC, the Obama administration spun the low participation rate as something akin to "Well, now that people don't have to have jobs for medical insurance, now they're free to drop out of the workforce and pursue their hobbies" or something. To be fair, that didn't strike me as a terribly convincing answer, but I'd wager it unlikely that the Trump administration would "credit" the ACA for the low participation rate, even if it were true.

> IIRC, the Obama administration spun the low participation rate as something akin to "Well, now that people don't have to have jobs for medical insurance, now they're free to drop out of the workforce and pursue their hobbies" or something.

You recall incorrectly. The Obama Administration never spun low labor force participation like that.

People on disability are the fastest-growing segment of the population, NPR profiles a county where 25% of residents are disabled http://apps.npr.org/unfit-for-work/

2 anecdotes: I work as a waiter and there are people in their late 20s and several over 50. College grads and older folks are (in my area) filling positions held by 19-25 year olds.

2. Radio shack had a were hiring ad at all locations in my area up until a few weeks ago when they went under. It signals they were doing well. Also, companies are always trying to add people with great skills or replace people if they have high turnover. They might not actually be hiring, just backing themselves up or replacing people.

To take it one step further, when does willful ignorance become disinformation and manipulation?

its willful ignorance to a more complex issue and all journalists are becoming more and more lazy and so the answer is ... BOTH, natch.

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