The economic challenge for young adults is significantly greater than for adults in their prime working
years. Young adults tend to be disadvantaged in terms of work experience, job contacts, advanced education and training, as well as by their perceived lesser maturity and productivity as workers. Those young adults who have limited education and weaker academic skills are even less competitive as job seekers. Furthermore, most women earn significantly less than men do, and many single mothers with children encounter serious problems entering and advancing in desirable careers. Finally, young African-Americans experience less success than Whites in terms of employment, wages, and income, even when compared with Whites of comparable educational attainment.
Young adults have a hard time becoming established as valuable and well-paid workers because they are limited in experience and skills. Almost all youth do some paid work during high school. Nationally, one-third of high school students age 16 and older work during any month. Those who work steadily during school for fewer than 20 hours per week tend to progress farther in college, while those with greater work experience during high school achieve more employment and earnings in the early years of their careers.
On the average, young adults not in college "mill about" and "churn" for 3 to 7 years before entering a long term job with tenure of 3 years or more. After leaving school, the typical high school graduate not going to college starts a permanent job 3 or 4 years later at age 22; the typical dropout starts a permanent job at age 23, 6 or 7 years after leaving school. However, half of all high school graduates and dropouts do not obtain permanent work until after ages 22 or 23, some not until their late 20s. African-Americans and other minorities are more likely to obtain their permanent jobs late in their 20s. Furthermore, much of the permanent work employing young adults provides low wages and limited or no benefits.
Eventually, greater maturity, experience, determination, and contacts enable young adults to find work in stable jobs with better pay. Nationally, 29 year old dropouts earn 73% more than 22 year old dropouts, and 29 year old college graduates earn 68% more than 22 year old college graduates. With age and experience, young adults increase their wages and incomes significantly. In South Carolina, young adults ages 25-29 and 30-34 have per capita income 71% and 117% higher than 20-24 year olds.
Education is closely associated with employment, wages, and income. For U.S. young adults in 1994, high school graduates had mean annual earnings well above those of dropouts. Among male high school graduates, earnings were more than double those of dropouts during ages 17-21 and 47% and 61% higher, respectively, at ages 22-25 and 26-29. Higher wages explained half to three-quarters of the difference, while the number of hours and weeks of work explained the rest. Among women, earnings of high school graduates were over 135% greater than for dropouts. Higher wages explained one-third to one-half of the difference, while more hours and weeks worked explained half to two-thirds of the difference.
Thus for both men and women, high school graduates earned 1.5 to 2.7 times as much as dropouts. Wage rates of high school graduates were approximately 50% higher, and the hours and weeks of work were also significantly greater, especially among women of all ages and among men ages 17-21. The following tables emphasize the greater economic success of young adults with more education:
Per Capita Income Advantage of Better Educated Adults in S.C.
(% higher than per capita income of dropouts)
| Ages | High School Graduates | Some College Education | College Graduates |
|---|---|---|---|
| 25-29 | 32% | 64% | 121% |
| 30-39 | 38% | 75% | 168% |
Source: 1990 U.S. Census.
In South Carolina, the earnings of persons with more education are significantly higher than those with less education. In the 1990 Census, high school graduates earned 32% to 38% more than dropouts, while college graduates earned 121% to 168% more than dropouts.
Additional data from the 1990 Census show that among 25-29 year olds the poverty rates of dropouts were much higher: 27% for dropouts, 12% for high school graduates, 8% for persons with some college but no degree, and 4% for college graduates.
1995 Employment, Earnings, and Income of 18-34 Year Olds in the U.S.
| Labor Market Outcome | Men | Women | ||||||
|---|---|---|---|---|---|---|---|---|
| High School Dropout | High School Grad | Associate's Degree | Bachelor's Degree or Higher | High School Dropout | High School Grad | Associate's Degree | Bachelor's Degree or Higher | |
| Employed Full Time | 48% | 71% | 77% | 82% | 23% | 44% | 58% | 64% |
| Mean Weekly Earnings of the Employed | $323 | $420 | $562 | $679 | $221 | $296 | $396 | $536 |
| Percent Who Were Poor or Near Poor | 35% | 15% | 8% | 5% | 58% | 27% | 12% | 5% |
Note: Estimates exclude those 18-24 year olds who were enrolled in school and all persons born outside the U.S. who migrated to the U.S. after 1980.
Source: Sum, et al. 1997, p. 102.
Many women in S.C. have serious problems with employment, wages, and income. During ages 20 to 44 in 1990, 24% to 30% of White women and 26% to 42% of African-American women were not working. However, compared with 1970, an additional 20-25% of White and 10-15% of African-American women had jobs in 1990. The one-quarter of White women and one-quarter to one-third of African-American women ages 25-44 not working usually have been supported by the men in their lives, or by their parents, or have endured a marginal existence, often dependent on public assistance.
S.C. Females Not Employed
| Ages | White | African-American | ||||
|---|---|---|---|---|---|---|
| 1970 | 1990 | 2000 | 1970 | 1990 | 2000 | |
| 20-24 | 47% | 30% | 32% | 50% | 42% | 43% |
| 25-29 | 52% | 27% | 27% | 45% | 32% | 30% |
| 30-34 | 50% | 27% | 28% | 43% | 29% | 31% |
| 35-44 | 45% | 24% | 27% | 41% | 26% | 32% |
Note: See also Appendix A.
Source: U.S. Census of Population and Housing; 1970, 1990, and 2000.
Why are more women than men not working? National survey data indicate that women do not work because of home and family obligations, while men do not work because they cannot find a job, are disabled, or are in school.
Reasons for Not Working
| Ages | Total | Sick/Disabled | Home/Family | Can't Find Job | School/Other | ||||
|---|---|---|---|---|---|---|---|---|---|
| Male & Female | Male | Female | Male | Female | Male | Female | Male | Female | |
| 18-24 | 100% | 7% | 3% | 2% | 43% | 17% | 5% | 73% | 48% |
| 25-34 | 100% | 36% | 8% | 5% | 76% | 28% | 7% | 31% | 9% |
Source: Mitchell, 1995, p. 169.
The income of women is substantially below that of men. The following table shows that while the per capita income of men increases rapidly during young adulthood, the income of women starts lower and increases moderately. White women in their late 20s are barely at the modest average of all South Carolinians but at only three-fifths of the income of prime working-age adults 40-59. African-American women are only at three-quarters of the overall average and two-fifths of the income of 40-59 year olds. Expressed in 1998 dollars, the per capita income of women ages 25-29 in 1989 was only $16,025 for White women and $11,771 for African-American & Other women.
Per Capita Income Disadvantage of Young Adults in S.C.
(% of per capita income of all 40-59 year olds in 1989)
| Ages | White Males | White Females | Afr. American & Other Males | Afr. American & Other Females |
|---|---|---|---|---|
| 20-24 | 54% | 35% | 37% | 26% |
| 25-29 | 96% | 58% | 59% | 42% |
| 30-39 | 131% | 65% | 74% | 52% |
| 40-59 | 165% | 62% | 81% | 47% |
Source: U.S. Census 1990 PUMS, special run.
Note: The average per capita income in South Carolina was $11,897 in 1989 or $15,704 in 1998 dollars.
The average income of all women obscures the economic plight of many women in very difficult circumstances. Poverty is quite widespread among women in S.C., especially young adults below age 25 and African-Americans. The poverty rate in 1989 for 18-24 year old women was 15% for Whites and 35% for African-Americans. Among 25-29 year old women, the poverty rate was 30% for African-Americans and under 9% for Whites.
One-fifth of White and one-third of African-American young adult men ages 20-24 were not employed in 1990. For most White males, this was merely a transitional stage during college or an awkward start toward integration into the workforce. In contrast, for many African-American men, not finding work can be a continuing dilemma throughout and beyond young adulthood.
It is significant that one-third of African-American males ages 20-24, one-quarter ages 25-29, and one-fifth ages 30-44 were not working in 1990. Furthermore, this situation was significantly worse than in 1970. Expressed in 1998 dollars, the mean 1989 per capita income of African-American males ages 20-24 was only $10,349 and among 25-29 year olds still only $16,233.
S.C. Males Not Employed
| Ages | White | African-American | ||||
|---|---|---|---|---|---|---|
| 1970 | 1990 | 2000 | 1970 | 1990 | 2000 | |
| 20-24 | 22% | 19% | 24% | 27% | 33% | 45% |
| 25-29 | 7% | 9% | 13% | 14% | 24% | 36% |
| 30-34 | 5% | 7% | 11% | 13% | 21% | 32% |
| 35-44 | 5% | 7% | 12% | 14% | 20% | 32% |
Source: U.S. Census Bureau, Census of Population and Housing 1970, 1990, 2000.
Note: See also Appendix A.
Unquestionably the most severe and pervasive economic problems of young adults are experienced by African-Americans. The unemployment rates of African-American young adults are at least double or triple those of Whites, but these rates exclude the high percentages not participating in the labor force. The rates at which African-Americans are not employed exceed those of Whites by 10-15% among all young adults, except for 25-29 year old women.
Household income of African-Americans has lagged behind that of Whites by over $10,000 for those headed by persons under age 25, by almost $15,000 between ages 25 and 34, and by nearly $20,000 after age 35.
1989 Median Household Income by Race
| Age of Head of Household* | ||||
|---|---|---|---|---|
| 15-24 | 25-34 | 35-44 | 45-59 | |
| White | $23,178 | $34,975 | $45,897 | $50,727 |
| Afr.American | $12,966 | $20,021 | $26,794 | $29,629 |
| Other | $20,407 | $28,641 | $37,991 | $46,262 |
*The head of household is the primary respondent for the Census.
Source: 1990 U.S. Census.
1999 Median Household Income by Race
| Age of Householder* | ||||
|---|---|---|---|---|
| Under 25 | 25-34 | 35-44 | 45-59 | |
| Total Population | $22,072 | $37,242 | $43,569 | $48,128 |
| White Alone | $25,098 | $42,052 | $50,613 | $55,530 |
| African American Alone | $15,236 | $26,247 | $30,003 | $31,900 |
*The person, or one of the people, in whose name the home is owned, being bought, or rented.
Source: U.S. Census Bureau, 2000 Census of Population and Housing.
African-American young adults in 1989 were disproportionately concentrated below or near the poverty level: for example, 30% of African-Americans ages 18-24 were poor, compared with 13% of Whites of the same age. Thirty percent more African-Americans than Whites ages 18–24 had incomes below one and a half times the poverty level.
Furthermore, while 10% and 15% of White males and White females respectively were poor during ages 18-24, for African-Americans the poverty rates were 25% and 35%. The poverty rates for Whites in their upper 20s and older were well below 10%, but the poverty rates of African-Americans remained high, with males around 15% and females especially high at 30% for ages 25-35 and at 25% for ages 35-44.
Poverty Rates in South Carolina during 1989
| Ages | Total | White Males | White Females | Afr. American & Other Males | Afr. American & Other Females |
|---|---|---|---|---|---|
| 18-24 | 19% | 10% | 15% | 25% | 35% |
| 25-29 | 12% | 6% | 9% | 16% | 30% |
| 30-34 | 12% | 6% | 8% | 17% | 30% |
| 35-44 | 10% | 4% | 6% | 16% | 25% |
Source: 1990 U.S. Census, PUMS.
% of Population Below Poverty in South Carolina in 1999
| Age Range | Total Population | White Alone | African American Alone | |||
|---|---|---|---|---|---|---|
| Male | Female | Male | Female | Male | Female | |
| 18-24 | 18% | 25% | 15% | 20% | 24% | 35% |
| 25-34 | 9% | 15% | 7% | 9% | 14% | 26% |
| 30-34 | 8% | 12% | 5% | 7% | 15% | 23% |
Source: U.S. Census Bureau, 2000 Census of Population and Housing.
Much of the economic plight of young adults is the consequence of the historically depressed, though steadily improving state of the economy of South Carolina. During the 1920s, the per capita income of South Carolina was less than 40% of the United States average, subsequently rising to 62% in 1960, 74% in 1970, and 81% in 1998. As a consequence, there have been fewer high-paying jobs for South Carolinians and very few for young adults.
Employment has grown rapidly in South Carolina from 461,400 in 1950 to 842,600 in 1970, and 1,699,500 in 1997, a dramatic economic accomplishment. However, many of the new jobs added since 1970 have been in retail trade and services, where the pay is often low.
In 1997, the average weekly wage in manufacturing was $614, in services $437, and in retail trade $273. Average manufacturing hourly wages have improved from 69% of the national average in 1960 to 83% in 1998, but manufacturing jobs are not increasing. Retail trade and services jobs are increasing substantially and employ a large number of young adults in jobs with low wages and few benefits. Continued growth of both jobs and wages in South Carolina is essential in order for young adults to advance economically.
| Industry | % of Total Employment of Age Group | Average 1989 Hourly Wages | ||||
|---|---|---|---|---|---|---|
| Shown in 1998 Dollars | % of Wages of 40-59 Year Olds | |||||
| 18-24 Yrs | 25-29 Yrs | 18-24 Yrs | 25-29 Yrs | 18-24 Yrs | 25-29 Yrs | |
| Agriculture/Forestry/Fishing | 2% | 2% | $6.79 | $10.91 | 67% | 108% |
| Mining & Construction | 7% | 8% | $9.09 | $12.22 | 54% | 73% |
| Manufacturing | 19% | 24% | $9.39 | $11.82 | 58% | 73% |
| Transportation & Public Util. | 4% | 5% | $9.34 | $13.39 | 50% | 72% |
| Wholesale/Retail | 29% | 19% | $7.10 | $10.91 | 52% | 80% |
| Finance, Insurance | 4% | 6% | $ 8.49 | $ 11.11 | 48% | 62% |
| Services | 22% | 25% | $7.59 | $11.15 | 47% | 69% |
| Government | 13% | 11% | $8.28 | $10.36 | 57% | 72% |
| TOTAL | 100% | 100% | $8.21 | $11.50 | 52% | 72% |
Source: 1990 U.S. Census; S.C. Employment Security Commission.
Over two-thirds of young adults work in wholesale and retail trade, services, and manufacturing. Young adults ages 18-24 averaged $8.21, and 25-29 year olds averaged $11.50 per hour in 1989, adjusted into 1998 dollars. Young adults ages 18-24 earned 52% of the hourly wage of mature workers ages 40-59; 25-29 year olds earned 72% of the hourly wage of mature adults.
1960-1998 Distribution of Jobs
| % of Total Non-Agricultural Employment | |||||
|---|---|---|---|---|---|
| 1960 | 1970 | 1980 | 1990 | 1998 | |
| Manufacturing | 57.2% | 40.4% | 33.0% | 24.8% | 20.3% |
| Durables | 10.2% | 10.1% | 10.1% | 9.1% | 8.5% |
| Non-Durables | 47.0% | 30.3% | 22.8% | 15.7% | 11.8% |
| Wholesale and Retail Trade | 20.7% | 16.8% | 18.9% | 22.6% | 24.1% |
| Services | 5.5% | 10.9% | 13.6% | 19.0% | 23.5% |
Source: S.C. Employment Security Commission.