WASHINGTON, D.C. – Teen unemployment averaged 30.8 percent in Alabama in 2010, the ninth highest in the country, according to a preliminary analysis of Bureau of Labor Statistics data by the Employment Policies Institute (EPI). The research showed unemployment among teens jumped from 27.9 percent in 2009.
EPI is a non-profit research organization that studies public policy issues surrounding employment growth, particularly on issues that affect entry-level employment.
The research organization says in states like Alabama, teens contended with extra barriers to employment because of a 40 percent increase in the federal minimum wage between 2007 and 2009.
"Last year, more than one in four Alabama teens were looking for work without success," said Michael Saltsman, research fellow at EPI. "This tough job market isn't just a product of the recession; minimum wage mandates are keeping teens out of work."
By increasing labor costs, higher minimum wages force employers to raise prices or cut costs. With consumers unwilling to pay higher prices, employers cut back on customer service or move towards automation– meaning fewer hours and fewer opportunities for entry-level employees like teens.
Recent research from economists David Macpherson (Trinity University) and William Even (Miami University) shows that the federal wage increase was particularly harmful for Alabama. Nearly 5,000 fewer teens were employed as a direct result of the federal wage mandate.
Saltsman concluded, "It's a new year, and with summer not so far off, Alabama legislators should focus on policies that create jobs for teens—not destroy them."
Top 15 States for Teen Unemployment, 2010