Racial differences in youth employment: work experience at an early age positively impacts labor force attachment of different racial groups; however, racial gaps in employment that are present in the early teen years seem to continue into adulthood

Monthly Labor Review, August, 2001 by Rosella M. Gardecki

Since the late 1960s, researchers have noted large differences in employment and unemployment rates among black workers, Hispanic workers, and white workers. These differences have generally been the greatest for younger workers. For example, Robert Flanagan documents that white workers have historically held jobs at a higher rate than black workers; for young workers, this gap widened in the 1960s and the 1970s when the employment rate of black teens decreased further. (1) Recent studies show that this early joblessness has an impact on later employment probabilities and wage outcomes. (2) However, few studies have examined the impact of jobholding on later employment probabilities among the youngest workers.

Data from the National Longitudinal Survey of Youth 1997 cohort (NLSY97) indicate that the youngest teens follow the same employment trends. Slightly more than half of the NLSY97 14-year-olds report some type of work activity; nearly 24 percent of them are working at an employee-type job (that is, working for an employer), while about 43 percent report employment at a freelance job (for example, babysitting, snow shoveling, pet care). (3) Jobholding among 14- and 15-year-old nonblack/non-Hispanic youths is markedly higher than among their black and Hispanic counterparts.

Working at a freelance job differs from working at an employee-type job in a number of aspects that may make freelance jobs a more viable option for many teens. Periods of actual work at freelance jobs typically are more sporadic and generally have low hours requirements. In addition, freelance jobs are not subject to the Fair Labor Standards Act--that is, they have neither maximum hours constraints nor the need for parental permission--and can be held at any age. As a result, many 12- and 13-year-olds, who are not eligible for most employee-type jobs, hold freelance jobs. Freelance jobholding in the NLSY97 does not stop at these ages, but continues to be a regular source of employment and income throughout the teenage years. (4)

This article examines the factors that affect different types of jobholding among teens in order to better understand employment decisions the youngest workers must confront, and how these decisions may differ by racial group. It focuses on the individual, family, neighborhood, and spatial characteristics that affect jobholding among teens living in a parental household. The pattern of an employee-type jobholder is examined separately from that of a freelance jobholder in an attempt to measure differences between the propensity to hold either type of job. This article presents a brief review of the existing literature on teen employment; explains the data used and the selection criteria for the NLSY97 sample; lists the factors that affect employment at any job for young workers--those aged 12 through 18 are considered--as a whole and by racial group (black, Hispanic, nonblack/non-Hispanic); examines the types of jobs held--that is, employee-type jobs and freelance jobs, and discusses the effect of holding a job, during the year that the youth was 14, on the probability of employment among teens ages 16 and older.

What previous research shows

According to recent figures, racial differentials in employment have continued into the present decade, improved economic conditions notwithstanding. (5) Despite the sizable gap in employment for teens, only a limited number of studies focus on this group; most researchers consider differences in labor force status among older workers who have finished their formal education.

In one of the few studies to examine jobholding among younger teens, Robert Michael and Nancy Brandon Tuma used data from the NLSY79 to consider differential employment effects for 14- and 15-year-old workers. (6) Nearly 25 percent of 14-year-olds reported being employed at the time of the survey, and this percentage increased for each age group. Even among the youngest workers, large differences in employment patterns were present between racial groups. White teens were more likely to be employed than their black or Hispanic counterparts at any age. Further, 16- and 17-year-old youths who reported employment prior to the age of 16 were more likely to be employed and were working more hours than those without prior experience.

Most of the remaining research focuses on racial differences in employment among older teens--those who are at least aged 16 years. (7) Although debate continues regarding which factors cause the differential, a number of characteristics have been identified. These factors can be grouped into four areas: individual characteristics, family determinants, neighborhood and geographic factors, and spatial mismatch measures.

Individual characteristics. Aside from the typical demographic characteristics (for example, age, race, gender, schooling), other individual characteristics may impact on the probability of a youth working. In particular, a number of studies focus on the relationship between employment and criminal activity. Not surprisingly, most of these studies support the hypothesis that crime and employment are competing forces for a youth's time. (8) As a result, participation in criminal activity decreases the probability that a teen is employed. Richard Freeman used self-reports of criminal activity as a measure of the tradeoff between crime and employment. He found that youths who reported committing a crime in the previous month were less likely to be employed than those who did not report criminal activity. Least likely to be employed were youths who reported high income from criminal activities or who had been jailed in the previous year. (9)