Best columns: Business
School is the new summer job
The summer job is no longer a rite of passage for most American teenagers, said Derek Thompson. Last summer, just 35 percent of American teens were working or looking for work, compared with 60 percent in 1978. But it’s not because teens are lazier now than they were a generation ago. “Education is to blame, rather than indolence.” The percentage of 16- to 19-year-olds taking summer coursework has tripled in the past 20 years. Employers are also “more reluctant to hire” teens, thanks to an influx of lowskilled immigrants and older workers who now compete for the kinds of jobs that used to be dominated by young people, like in fast food, construction, and retail. Higher minimum wage laws have also convinced some employers that it’s not “worth hiring” inexperienced workers. Other employers have realized they don’t have to pay teens at all, as evidenced by the “extraordinary rise” in unpaid internships, which aren’t counted in official employment statistics. Teens are “exquisitely sensitive” to what their peers do, and the cultural norm has shifted “toward summer classes and unpaid internships.” Rather than slack off, many teens choose to invest in their educational and professional future. Nostalgia for the disappearing summer job is all well and good, but it’s “hardly the place to expend America’s finite national anxiety.”
Uber’s biggest weakness
Uber’s unending cascade of scandals might be the least of its worries, said Noah Smith. So far, the ride-hailing giant’s troubles haven’t managed to “put a huge dent” in its market share, with the company providing nearly four times as many rides as rival Lyft in March. Even so, “basic economics shows some cracks in Uber’s model.” Like other Silicon Valley companies, Uber relies on “network effects” to compel customers to stick with it. That is, the more people who use a service, the more useful that service becomes to them, and the harder it becomes to adopt a competitor. For instance, I continue to use Facebook “because my friends are on it, and the same is true for them.” Uber “undoubtedly has a network effect”—having more drivers means shorter wait times, which means more riders, and thus more drivers—but the effect might not be as strong as Uber’s cheerleaders give it credit for. Dominating one city doesn’t help Uber much in another city, and many Uber drivers also drive for Uber’s competitors. Even Uber’s plan to eventually use self-driving cars could backfire, if people’s own cars “start to function as their own private taxi cabs.” All these weaknesses “might not be catastrophic.” But Uber’s investors should understand that the company’s long-term dominance is far from assured.