BlackRock chief investment officer Rick Rieder says rising unemployment among young Americans is becoming one of the most underappreciated risks in the U.S. economy, warning that joblessness for younger workers is already elevated and likely headed higher.
In a Fox Business interview, Rieder says headline unemployment figures mask a growing bifurcation beneath the surface, where younger and lower-income workers are facing significantly worse conditions than the broader labor market.
“So when you actually break it down, 4.4% is not a disastrous number, but it is trending up. It was 4.1% a couple of months ago. It is trending up. If you get underneath the surface and you look at what I think is a real problem, if you take youth unemployment, people 20 to 24 years old, it’s 8.3%. [Gen Z] are having a super hard time today.”
He says lower-skilled and younger workers are bearing the brunt of a slowing labor market, pointing to broader measures of underemployment.
“If you take lower-skilled jobs, you take the U-6, it’s 8.7% unemployment. We have an incredible bifurcation in the economy today. Young people are having a really hard time. You saw the Michigan survey. It’s the hardest time getting a job since they’ve been doing the survey. It’s very, very challenged.”
When asked whether companies are effectively operating under a “no-hire, no-fire” approach, Rieder agrees and says the dynamic will continue to pressure younger workers.
“You see big companies announcing layoffs. Over time, they’re just going to let attrition work its way through. And so I think that the youth unemployment number is going higher.”
Last week, Rieder said that lower-skilled jobs are going away, not because of AI, but because firms are boosting productivity gains across business operations. Billionaire Chamath Palihapitiya expressed the same view in October, when he said that firms were trimming their headcount after seeing Elon Musk fire 80% of Twitter/X, while operating the same or better.
Disclaimer: Opinions expressed at CapitalAI Daily are not investment advice. Investors should do their own due diligence before making any decisions involving securities, cryptocurrencies, or digital assets. Your transfers and trades are at your own risk, and any losses you may incur are your responsibility. CapitalAI Daily does not recommend the buying or selling of any assets, nor is CapitalAI Daily an investment advisor. See our Editorial Standards and Terms of Use.