3 reasons teens are cashing in on a hot jobs summer

• Right now is a good time to look for work if you're a teen while employers look to fill open roles.
• The share of teens who have a job in June 2021 was similar to that in June 2019 after falling in 2020.
• We talked to Luke Pardue, an economist at Gusto, about the teen employment situation this summer.

This summer is looking a lot brighter for teen employment compared to last year.

Pew Research noted that in 2020, teen summer employment "plunged to its lowest level since the Great Recession, erasing a decade's worth of slow gains." However, the employment-to-population ratio, or the share of teens who have a job, was 31.9% in June 2021, roughly back to where it was two years ago at 31.4% and back up from the 25.2% in June 2020. The New York Times noted that the teen ratio in April 2021, 32.8%, hasn't been that high since 2008.

The unemployment rate for 16 to 19 year olds was 9.9% in June 2021 - not only down from pandemic highs but lower than the pre-pandemic rate of 11.5%.

"This explosion in teen employment is really driving the recovery, particularly in service sector industries that are booming right now," Luke Pardue, an economist at Gusto, told Insider.

June data on Gusto, a payroll and benefits platform for small businesses, showed teens made up 32% of new hires in small businesses on the platform. This share is usually roughly 10%.

While June teen employment seems to be back to where it was before the pandemic, Insider talked to Pardue to understand why teen hiring is booming.

(1) Teens are ready to fill open positions while some older workers aren't searching for jobs

On Gusto, half of teens work in food and beverage; retail; and sports and recreation small businesses.

"The businesses in these industries are still cash strapped, and teens provide an attractive option because they are often willing to work for a lower wage than a more experienced worker," Pardue said.

He added there are a few reasons why we're seeing a boom in teen employment this summer while some older workers stay out of the workforce: lack of childcare access, unemployment benefits, and overall pandemic concerns.

"And so as those continue, the obstacles for older workers to reenter the labor force remain, we would likely see teen employment continue to increase," Pardue said.

(2) Companies are offering financial incentives and other perks to attract teen workers

Some companies have bumped up pay to attract workers. MarketWatch reported on one company that increased pay at eight amusement parks and is offering summer bonuses to some teens. On Gusto, teens in service jobs have seen wages increase from an average of $10.40 in January 2021 to $11.70 through June 2021.

"Teenagers hold all the chips at the table right now," Pardue said. "So if they want to bargain for a higher wage or some workplace flexibility, owners are definitely willing to work with them a little bit."

Non-financial perks abound, too. Lyn James owns a small business in North Dakota: Flowers and Cappuccino by Lasting Visions. She has five teens working there. She told Insider she thinks they're excited about working at the flower shop and coffee bar because of the flexibility. She works around their vacation schedules, camps, or second jobs.

James said she saw more teen applicants this summer and she hired more to help cover for older workers who wanted to cut back hours for the summer to spend some quality time with their kids.

(3) More teen are looking for summer jobs

Pardue said not only are managers looking for creative ways to attract workers but more teens seem to be interested in working.

"One reason would be that last summer, a lot of teens were shut out of jobs as these hard-hits sectors were decimated and teenagers were the first ones to be cut," Pardue said.

But Pardue notes that it's best that teens looking to make some cash apply as soon as they can, especially with July being the employment peak.