In today’s labor market, unemployment rates have been relatively low, but not everyone who wants a job has been able to secure one. The term “NEETs” has been coined to refer to individuals who are “not in employment, education, or training.” These individuals often feel discouraged by their economic standing and as a result, are opting out of the labor force. According to a recent report by Korn Ferry, there is a growing population of “new unemployables,” who are highly qualified individuals struggling to find job opportunities. This trend has become particularly evident among individuals aged 16 to 24, where the unemployment rate rose to 9% in May.
While the youth unemployment rate fell below 7% in 2023, it is important to note that this was during a period of robust economic growth. Alí Bustamante, a labor economist, highlighted that 9% unemployment among younger workers is more typical during relatively good economic times. However, in 2023, about 11.2% of young adults in the U.S. were classified as NEETs, indicating that a significant portion of the youth population is being left out and left behind in terms of employment and skill development. Young men, in particular, are facing challenges in the labor market, with declining opportunities in traditionally male-dominated industries.
According to Korn Ferry, there is a “perfect storm” contributing to the rise of new unemployables. Employers are increasingly focusing on talent retention rather than new hires, leading to fewer job openings for well-qualified candidates. This talent hoarding phenomenon has created challenges for individuals, especially in the early 20s, who are struggling to find desirable job opportunities. Despite a high teen employment rate, the labor force participation among 20-24 year-olds dropped significantly during the pandemic and has been slow to recover.
As hiring projections for the class of 2024 have decreased, individuals are facing longer stretches of unemployment. However, all hope is not lost. It is crucial for individuals to take proactive steps in their job search. Reaching out to former employers and colleagues, updating resumes with relevant keywords, and engaging in informational interviews can significantly enhance visibility in the job market. Instead of solely aiming for promotions or raises, individuals are encouraged to pursue a “career lattice” approach, where acquiring new skills and experiences can lead to future opportunities.
The current job market presents both challenges and opportunities for individuals seeking employment. By recognizing the trends in unemployment and job opportunities, and by taking proactive steps to enhance visibility and skill development, individuals can navigate the changing landscape of the labor market successfully.