Accoding to BLS data on unemployment rates by age, it looks like almost all of the .50% increase in May unemployment to 5.5% from 5% in April was due to increases in the jobless rates for young workers in the 16-24 year age group, especially the 16-19 year group (see chart above). For workers 25 years and over, the jobless rate has remained pretty stable at around 4%, compared to large increases from April for 16-19 year workers (+3.3% to 18.7%, the highest rate since 1993) and 20-24 year olds (+1.5%).
From the Patterico's Pontifications blog: Who does this age group represent? How about high school and college students coming into the job market for the summer.
And what do many such job seekers get paid? Minimum wage –which Congress increased last year from $5.15 to $5.85, and which will increase again next month to $6.55, and then again next year to $7.25 (see chart below).
Although it apparently hasn't received much media attention, perhaps there is a link between the rising unemployment rate for teenagers and the pending 12% increase in the minimum wage next month. Since we have evidence that consumers respond to higher gas prices by driving less, wouldn't it also be the case that employers of unskilled workers would respond to 12% increases in wages for unskilled workers by hiring fewer unskilled workers?
I'll verify this later, but from an initial inspection of BLS data on the history of the minimum wage, it looks like the +41% increase in the minimum wage from $5.15 per hour in 2007 to $7.25 in 2009 will be the largest 2-year increase in the minimum wage in U.S. history! And this HAS to have an adverse effect on employment of teenage workers.