The reasons behind the lack of employment among some young adults, referred to as 'NEETS' and 'new unemployables'.

• Despite a low unemployment rate of 4%, there is a rising proportion of young adults who are not employed.
• "NEETS" are opting out of the labor force by choice.
• Despite their best efforts, "new unemployables" are still struggling to find employment.

Despite the 30-month low of the unemployment rate being near a record, not all job seekers have found employment, and not everyone wants a job.

Individuals who are not employed, enrolled in education or training, often referred to as "NEETs," are choosing to leave the labor force due to their poor economic situation.

A recent report by Korn Ferry states that while others may be well-qualified, younger candidates who are struggling to find positions make up a contingent of "new unemployables."

In May, the unemployment rate among 16- to 24-year-olds increased to 9%, which is considered "typical," says Alí Bustamante, a labor economist and director of the Worker Power and Economic Security program at the Roosevelt Institute, a liberal think tank in New York City.

According to Bustamante, the low youth unemployment rate of below 7% in 2023, as reported by the U.S. Bureau of Labor Statistics, was indicative of the hot labor market at that time.

He stated that during good economic times for younger workers, we can expect around 9%.

'NEETS' feel 'left out and left behind'

In the U.S., some young adults are neither employed nor acquiring new skills.

According to the International Labour Organization, in 2023, approximately 11.2% of young adults aged 15 to 24 in the U.S. were classified as NEETs.

Bustamante stated that many young people are being left out and left behind in various ways.

Although "that's usually the norm," he stated, "we should anticipate these rates to be lower."

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According to labor economist Julia Pollak of ZipRecruiter, young men are increasingly disengaged.

"The NEET trend is mostly a male phenomenon," she said.

Pollak stated that the decline in opportunities for traditionally male-dominated occupations, such as construction and manufacturing, has contributed to the increase in women's enrollment, education, and employment outcomes.

'Talent hoarding' has led to 'new unemployables'

A "perfect storm" has resulted in a surplus of highly skilled workers who are unable to secure employment, according to Korn Ferry's report.

Korn Ferry's senior vice president for global talent acquisition transformation, David Ellis, stated that employers are retaining their current talent and shifting their focus towards talent mobility.

He stated that the "talent hoarding" has resulted in a decrease in job openings, even for qualified candidates.

As firms are cutting back on new hires and limiting entry-level opportunities, they are also scaling back on new hires.

During the pandemic, the labor force participation of 20- to 24-year-olds dropped significantly and they have been struggling to find jobs, according to Pollak.

According to a report from the National Association of Colleges and Employers (NACE), the hiring projections for the class of 2024 decreased by 5.8% compared to the previous year.

With more candidates vying for fewer job openings, the duration of unemployment is increasing. According to Korn Ferry, the number of individuals who have been unemployed for over six months has risen by 21%.

'Unemployable' to employable

Despite the trends in the job market, "all is not lost," Ellis stated.

He advised against waiting to reach out and suggested getting back in touch with former employers or colleagues through LinkedIn or email to set up informational interviews. After the initial approach, ask for any job leads or contacts.

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Instead of focusing solely on roles that offer promotions or raises, Ellis suggested considering a "career lattice" approach, which might involve accepting a lower position in order to acquire valuable skills that will benefit you in the long run.