Despite unemployment rates that have hovered at or below 4% for 30 months, signaling near-record lows, a significant number of young adults find themselves on the sidelines, struggling to secure employment or opting out of the labor force altogether. There are two different groups in this conversation: The first are “NEETs.” As in not in employment, education, or training, and then we have the “new unemployables,” a term created by the consulting firm Korn Ferry as a way to describe highly trained individuals who face impossible hurdles in finding employment.
The Rise of NEETs: Disengaged and Disheartened
The term NEET has gained renewed relevance in recent years even though it’s been around for a while. According to the International Labour Organization, about 11.2% of young adults aged 15 to 24 in the U.S. were classified as NEETs in 2023. That percentage means that about one in ten young people are not only out of work but they’re not pursuing education or training opportunities either, a situation that has led labor economist Alí Bustamante from the Roosevelt Institute to comment that many young adults are “being left out and left behind in many ways.”
Julia Pollak, a labor economist at ZipRecruiter, notes that the NEET trend is predominantly a male phenomenon. She attributes this to declining opportunities in traditionally male-dominated sectors like construction and manufacturing, while women have generally seen upward trends in education and employment outcomes. This disparity shows a major change in the job market, where opportunities are rarely, if ever, distributed across genders.
The Challenge of the ‘New Unemployables’
Parallel to the rise of NEETs is the emergence of the “new unemployables,” a group described by Korn Ferry as highly trained but struggling to find job opportunities. David Ellis, senior vice president for global talent acquisition transformation at Korn Ferry, explains that a “perfect storm” of factors has led to this situation. Employers, wary of losing valuable talent, are increasingly engaging in “talent hoarding,” focusing on internal mobility rather than external hiring. This has resulted in fewer available job openings for well-qualified candidates, especially at entry levels.
This phenomenon has been kicked up a notch by firms pulling back on new hires, a trend that has particularly affected those in their early 20s. While the teen employment rate has reached its highest point in over a decade, young adults aged 20 to 24 have seen a significant drop in labor force participation since the pandemic.
A Closer Look at Youth Unemployment Trends
Youth unemployment, which is always a thing, has moving mad in recent years. In May, the unemployment rate for 16- to 24-year-olds rose to 9%. Bustamante points out that this is typical and should be expected during relatively good economic times for younger workers. However, the sharp drop below 7% in 2023 was indicative of an exceptionally hot labor market at that time, a condition that has since cooled.
The National Association of Colleges and Employers (NACE) reported a 5.8% decline in hiring projections for the class of 2024 compared to the previous year. This decline, coupled with the increase in long-term unemployment (defined as being unemployed for longer than six months), underscores the competitive and challenging nature of the current job market for young adults. Korn Ferry’s findings reveal a 21% increase in the number of people experiencing long-term unemployment, further highlighting the struggles faced by job seekers.
Navigating the Job Market: Strategies for Young Adults
Despite these challenges, there are strategies that young adults can employ to enhance their job prospects. David Ellis advises against waiting passively for opportunities to arise. Instead, he suggests proactively reaching out to former employers or colleagues through platforms like LinkedIn or email. Setting up informational interviews can also be a valuable step. These conversations not only provide insights into industry trends but can also lead to job leads or useful contacts.
In addition to networking, visibility is crucial. Young job seekers should consider writing about noteworthy topics in their industry, thereby demonstrating their knowledge and engagement. Updating resumes with relevant keywords and “title tags” that highlight key elements can also make a significant difference in catching the attention of recruiters and hiring managers.
Ellis also recommends adopting a flexible approach to job hunting. Instead of focusing specifically on roles that offer promotions or raises, young adults should consider an approach known as the “career lattice.” This may involve taking positions that are lateral or even lower in hierarchy to gain essential skills and experience. Such roles can provide a foundation for future career advancement, offering dividends in the long run.
A Path Forward
The landscape of the job market is continuously evolving, presenting unique challenges for young adults today. While the rise of NEETs and the struggles of the new unemployables highlight significant hurdles, understanding these dynamics can empower young people to navigate their careers more effectively.
By leveraging proactive strategies, enhancing visibility, and adopting a flexible approach, young job seekers can better position themselves for success in an increasingly competitive market. The journey may be arduous, but with perseverance and adaptability, there is hope for a brighter professional future.
