The “Key” Job Stat – Employment Rate of 25-34 Year Olds

According to Leigh Gallagher, Fortune.com Assistant Managing Editor, when the March 7th U.S. jobs report is issued, analysts will focus on the employment level of young adults, which Mr. Gallagher says is defined as 25-34 year olds. (http://features.blogs.fortune.cnn.com/2014/03/03/housing-youth-employment-rate/).

Apparently, the U.S. economy could benefit greatly from continuing improvement in the employment level of young adults because as their employment rate increases, so does family formation.

Family formation sparks all kinds of related spending, such as for housing, durable goods, etc. And, of course, when young adults begin investing in housing & related assets, the U.S. economy will benefit.

Of course, Mr. Gallagher points out that the “month-to-month” young adult employment rate is a volatile stat, so the employment rate trend is more important than the point estimate.

Additionally, young adult employment improvement is a lagging indicator of economic improvement because the level & rate of family formation & investing in housing is, at best a long term proposition.

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About docjonz

I am an Associate Professor of accounting at Hofstra University in Hempstead, NY. Additionally, I have more than 30 years of professional accounting experience in various capacities including auditing, accounting standard setting and corporate accounting policy.
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