Although the economy has recovered from the depths of the recession of 2007-2009, there are 4.25 million fewer payroll employees than there were in September 2007 according to the Bureau of Labor Statistics (BLS). It is more troubling that there are 6.05 million fewer people working full-time than in September 2007 according to the BLS household survey. There are over 8 million people working part-time for economic reasons, most of them due to slack work. The deficit in full-time jobs relative to the pre-recession economy is a symptom of a weak economic recovery.
No group has seen a bigger shift to part-time employment than young adults age 20 to 24. In the past five years young adults in this age group have seen a 23.3% decrease in full-time employment and a 22.4% increase in part-time employment (relative to population). The following chart shows that 37.6% of employed adults age 20 to 24 now work part-time. This is the highest fraction since the BLS began reporting these figures. Between 1994 and 2007 the share of part-time work increased from 27.4% to 28.4% for this age group. Since the recession the part-time employment rate has risen dramatically.
The increase in part-time employment relative to full-time employment over the past decade is attributable to many factors including the weak recovery, rising cost of health care benefits, economic uncertainty, and the changing demographics of the U.S. labor force. One of the main reasons why adults age 20-24 are working part-time in record numbers is that new graduates are struggling to find jobs in their fields. Thus young workers are settling for part-time work as they wait for the economy to improve so they can pursue their careers. Fewer full-time jobs results in lower tax revenue, higher deficits and slower household formation. When new college graduates end up in part-time jobs and move back in with their parents it is bad news for the housing market and construction sector.