This post continues our three-part series on the state of youth employment in New York City. In part one, Economic Mobility for New York City’s Young Adults: Where Progress Meets Persistent Barriers, JobsFirstNYC examined new findings showing that the share of young adults who are out of school and out of work (OSOW) has reached an all-time low, even as deep disparities persist across neighborhoods. In this second installment, our partners at the Center for New York City Affairs (CNYCA), part of The New School, take a closer look at the labor market dynamics shaping these trends—exploring how shifts in unemployment, labor force participation, and opportunity intersect to influence young people’s economic mobility.
This guest analysis from CNYCA, provides additional perspective and contextualizes the data to deepen our understanding of how young adults are navigating New York City’s evolving economy.
By Ludovica Tursini, Center for New York City Affairs (CNYCA) at The New School
In 2024, New York City’s youth had the highest unemployment rate of any group in the city. American Community Survey (ACS) data released this year for 2023 provides important insights into how young New Yorkers—particularly 16- to 24-year-olds—are faring in the labor market. While some indicators suggest improvement since the pandemic, others highlight persistent challenges that merit policy attention.
Youth Employment and Labor Market Participation
The rate of young people who are out of school and out of work (OSOW)—defined as 16- to 24-year-olds who are not enrolled in school and are either unemployed or completely out of the labor force—fell back to 12.6% in 2023. This marks a return to pre-pandemic levels and a notable drop of 3 percentage points from the peak of 16% during the pandemic years of 2020 and 2021.
This is a reassuring development, yet it also points to continued vulnerabilities. Young adults remain more exposed to labor market fluctuations than older workers. In 2023, the unemployment rate for out-of-school 16- to 24-year-olds was 13.4%—higher than pre-pandemic levels and more than double the unemployment rate for adults aged 18 and older.
Among the roughly 106,000 young people who were not in school and not participating in the labor market, nearly 30% reported actively seeking work, while the remaining 70% (approximately 72,000 individuals) were not engaged in school or the labor market. Related research provides some context. A report by the Future of Families and Child Wellbeing Study found that 22 year olds who had not worked in the prior year were much more likely to report disability or other barriers to employment. Consistent with this, 10% of the OSOW population reported a disability, compared with just 6% of the broader 16- to 24-year-old population.
Education does not fully shield young people from these challenges. While nearly half of young adults who are OSOW hold only a high school diploma or GED, 15% have at least a bachelor’s degree—underscoring the difficulty some young people face in navigating the transition from school to work and from adolescence to adulthood.
Demand for Young Workers
Another factor that impacts youth labor market outcomes is whether or not there are businesses looking to hire young people, who, by nature of their age, have less education and experience than the general workforce and likely have fewer networks. In 2023, the industries with the highest shares of 16- to 24-year-old workers in New York City were:
- Retail Trade (18.7%)
- Entertainment (18.6%)
- Education (11.2%)
- Social Assistance (7.9%)
- Manufacturing (7.7%)
While these industries have a good track record of hiring young people, each of these industries has been reshaped in post-COVID New York, which may provide further insight into the challenges young New Yorkers face in the labor market today. For example, retail and entertainment, which employ the largest total number of youth in the city, have both experienced job decline since 2020.
Figure 1:
Source: CNYCA Analysis of American Community Survey, 2023 and 2019 1-year micro-data. U.S. Census Bureau
While young people have grown their share of total employment in these sectors since 2019, the total number of youth working in these sectors declined during this time period. Young people continue to find job opportunities in retail and entertainment, but there are simply fewer jobs in these sectors for them to access.
On the other hand, the city has seen job growth in education and social assistance in recent years, where young people have experienced an increase in total employment. The education sector has also experienced an increase in the share of young workers. While overall growth in education jobs has been minimal (compared to the significant increase in social assistance jobs), this is a sector that young people are well-networked in, by virtue of many of them being students or recent graduates themselves.
In 2023, manufacturing experienced an increase in both the absolute number of young people employed and the share of young workers in the industry. These increases were substantial enough to make this a top industry for the share of young workers, replacing Other Services (which includes jobs in a wide range of services, from auto repair to hair and nail salons).
Population Shifts and Demographic Change
Labor market indicators for young adults are also shaped by broader demographic changes.
From 2019 to 2023, the city’s 16- to 24-year-old population fell by 3.5%, and its racial composition also shifted:
- The white youth population declined 2.5%.
- The Black youth population declined 12.2%.
- The Hispanic youth population declined 5.9%.
- The Asian youth population declined 1.2%.
The Brookings Institution has documented a growing outmigration of the Black population, especially young Black individuals, from the Northeast to the rapidly expanding “New South,” driven by both economic opportunities and cultural ties. The New York State Comptroller’s Office has further linked pandemic-era economic hardship—including high inflation and rising rents—to higher rates of outmigration among Black and Hispanic households, and particularly among low-income households. According to a New York State Comptroller’s report, the share of nonwhite households leaving the city rose to 64% in 2022, up from 58% in the previous year.
In a previous post, Center for New York City Affairs reported that the city’s median household income declined by 6.9% between 2019 and 2022—one of the steepest drops among the ten largest U.S. cities. The decline in median household income was particularly sharp among Black and Hispanic households, which may have exacerbated the outmigration of these groups from New York City.
Taken together, the ACS data paints a complex picture. On one hand, rates of young adults who are OSOW among youth have receded from pandemic-era highs. On the other hand, unemployment among out-of-school youth remains elevated, and population shifts suggest widening racial disparities in who can live and thrive in New York City.
For policymakers, the message is clear: Black and Hispanic youth face compounded challenges—economic, demographic, and structural—that risk deepening inequality unless addressed through targeted policies. As the city looks ahead to a mayoral administration focused on affordability, these findings highlight the importance of policies that expand economic mobility for young adults, enabling them to build thriving futures in New York City.
The Center for New York City Affairs at The New School is an applied policy research institute that drives innovation in social policy.