Why Teenagers Stop Working in the Summer

Everyone has a culprit for disappearing teen summer jobs. Artificial intelligence is eating away at entry-level jobs. Tariffs are squeezing small businesses that employ children. Even the Strait of Hormuz has been blamed for gas prices. Summer hiring forecasts — the weakest since the government began keeping statistics in 1948 — seemed to confirm those fears, with a Cape Cod ice cream shop filling 50 positions but turning away hundreds of teenage applicants, becoming a symbol of the season’s lukewarm market.

Most of them are wrong, and a little economics will show why. The classic summer job has been disappearing for nearly half a century, since teen labor force participation peaked at 57.9 percent in 1979. During much of this period, the teen labor market did not get any tougher. Things got easier. Teenagers leave on purpose—understanding why they leave, for whom, and with what consequences, the old lament about kids these days turns into something much more useful.

Since 1979, the share of employed 16- to 19-year-olds has fallen by a third, from 48.5% to 31.1%. However, today’s youth unemployment rate (the proportion of teenagers who are looking for work but cannot find one) is lower at 14%, compared with 16% in 1979. Attributing the 17 percentage points drop in the employment rate to its sources illustrates the imbalance: about 18 percentage points come from teenagers leaving the labor force, while about 1 percentage point goes the other way, as those looking for work now find it easier to find work. Teenagers are not unemployed. They don’t want them anymore.

The numbers exonerate the usual suspects in this summer’s chronic crimes. Chatbots can’t explain the decline that began under Jimmy Carter. Tariffs and oil tankers don’t explain why forty-somethings are giving up jobs they might otherwise have had.

This summer’s villains do explain something — but not a trend. Teen unemployment has risen from about 11% to more than 14% in the past two years as seasonal hiring at restaurants and amusement parks declines and automation creeps into entry-level employment. The weakness in demand is real and new. But this was a two-year shock on top of a 45-year trend that was the exact opposite, and the mistake nearly every commentator makes is mistaking the shock for a trend.

Why did they leave? The price of teenage time has changed dramatically. From the late 1970s to 2000, the wage premium associated with a college degree roughly doubled, from about 40% to nearly 80%. The time a 16-year-old once spent folding shirts at the Gap now carries a much higher opportunity cost; conversely, spending money on anything that will get you to college has a much greater lifetime return. At the same time, the returns on the fold have shrunk: The federal minimum wage, adjusted for inflation, is about 40% below its 1968 peak. The result is rising enrollment, but school isn’t the whole story: The Bureau of Labor Statistics found that even among teenagers who weren’t enrolled in school, the labor force participation rate fell from 76 percent to 65 percent between 2000 and 2015.

The employment distribution among teenagers is never even; it increases with family income. In the summer of 2023, 46% of teenagers from households earning $100,000 to $150,000 were employed. Only about a quarter of teenagers from the poorest families with incomes below $30,000 do so.

For wealthy teenagers, skipping a paycheck is real optimization. She traded her lifeguard position for research internships, science camps and SAT tutoring. Economists Shirley Porterfield and Anne Winkler found that the setbacks were greatest among the most educated and highest-income families, and that the alternatives these families sought—unpaid internships and enrichment programs—were precisely what lower-income families couldn’t afford.

For poor teens, “choice” is often the wrong word, because the teens who need summer jobs the most are the ones who can’t find them. In 2025, New York City’s summer jobs program, the nation’s largest, attracted about 200,000 applications and offered about 100,000 positions, which were allocated through a lottery. Economist Alexander Gelber and his collaborators studied these lotteries and found that winning the lottery increased a teen’s chances of working that summer by 71 percentage points, directly demonstrating how many desired jobs are out of their reach.

Which brings us back to the ice cream shop. Those turned away applicants on Cape Cod aren’t evidence of a market collapse—unemployment data contradict that—but they’re evidence of something more poignant: Kids who still need those jobs are competing for the fewer and fewer jobs available to them, while their affluent peers who once stood next to them are no longer invested in their futures.

That lead isn’t even the most worrying part. Sara Heller studied employment programs in Chicago and found that eight weeks of summer jobs reduced arrests for violent crimes among disadvantaged youth by 43 percent, and that the effects were even stronger after the jobs ended. While studying the New York project, Gelber and his co-authors matched about 290,000 lottery records with tax and death records and found that winning a summer job reduced the risk of death in subsequent years by about 18 percent due to fewer homicides, especially among young people. However, the same New York jobs did not increase the children’s subsequent earnings; if anything, they slightly lowered their academic performance without compromising college success.

The summer when I was 15, in the midst of the madness of my adolescence, I shopped for $4.35 an hour at the Albertson’s in Lewisville, Texas, buying groceries for $4.35 an hour, not to write a resume but to put some money in my pocket and have somewhere to go when my friends and I got into trouble during the long afternoons. Albertsons is not a temple of human capital formation. Most of my shift is spent with the kids in the produce section. But lottery research shows that the two most important things are precisely providing structure to a teen who might be adrift, and cash to a family with no spare cash. This minimum wage job is probably one of the most rewarding things that has ever happened to me.

Disappearing summer jobs are two experiences buried in one statistic. For most American teenagers, this decline is a rational bet on the future that their time elsewhere will pay off. To me, the same numbers meant opposite things. If we’re going to worry about summer jobs disappearing, let’s worry about the teens who need it most. It’s been a matter of life and death for them for decades – and it’s the one thing no one talks about.

Mr. Fryer is a contributor to The Wall Street Journal, a professor of economics at Harvard University, founder of Equal Opportunity Ventures and a senior fellow at the Manhattan Institute.