Every Unemployed Youth Costs Society $37,000 A Year
The crisis of jobless youth might be seen as mostly a problem for jobless youth, the so-called "lost generation," and many of their parents, too, who are providing shelter for their 20-something offspring in record numbers. But it's a problem for the country, too. According to a new report, every unemployed young adult is siphoning an average of $14,000 out of the system annually, and burdens it by a total of $37,000 yearly.
The White House Council for Community Solutions report, compiled by researchers from Columbia University and the City University of New York, estimates that 17 percent of 16-to-25-year-olds are currently neither students nor workers. That's 6.7 million young people, disproportionately male and minority, who aren't gaining any skills in their key career-launching years, unless you count massacring Nazi zombies in "Call of Duty: World at War."
Of these "opportunity youth," as the report encouragingly calls them, 3.4 million are "chronic," which means that they haven't worked or been in school since age 16. While 36 percent of the U.S. population has secured at least an associate degree by age 28, the researchers estimate that just 1 percent of "opportunity youth" will do the same.
Unsurprisingly, these young people take greater advantage of government programs, and will do so for the rest of their lives. They also burden the nation through higher rates of crime, as well as lost earnings and tax revenue, even once they find employment. As several studies have found, unemployment at a young age leads to lower income over a lifetime. This report estimates that for an opportunity youth this loss is almost $400,000 each.
The report categorizes the national cost of membership in this category through two overlapping measures. One is the direct price paid by the taxpayer, which includes extra social services, as well as the cost to the criminal justice system. The other is a more macro social cost, which takes into account lost earnings, additional health costs, the total price of crime, as well as the necessary increase in taxes on everyone else to pay for it all.
Every "opportunity youth" costs the taxpayer $13,900 a year, although this number varies wildly when the young people are categorized by race, ethnicity and gender. The fiscal burden of black men is around $28,000 each per year; for white women, it's a hair above $5,000.
The annual social cost per opportunity youth is over $37,000. When these young people reach 25, they will cost taxpayers a further $171,000 over their lifetimes, and a social burden of over half a million. These young people will be a $4.75 trillion drag on the economy over the next several decades, and as more young people become opportunity youth each year, these costs will continue to multiply.
The researchers set out to determine the real impact of the current jobless youth crisis to an extent never before attempted. But even their analysis excluded certain costs, like the burden on families who are supporting their dependent children, the payouts of nonprofits and charities, as well as the economic and health costs relayed by these young people onto their children.
And of course there are the costs that are impossible to measure or predict. When nearly 1 in 5 members of a generation have failed to complete college or secure stable employment, it can't help but leave a wound on the national psyche. No one knows yet what shape that scar will take.
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Claire Gordon has contributed to Slate's DoubleX, the Huffington Post, and the book Prisons: Current Controversies. While an undergraduate at Yale University and a research fellow at Yale graduate school, she spoke on panels at Yale and Cornell, and reported from Cairo, Tokyo, and Berlin.
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