TRAVERSE CITY, Mich. -- New-vehicle sales are climbing steadily, but they are still depressed by a lack of full-time jobs for young adults, an economist said.
The number of Americans with only part-time jobs continues to rise long after the recession, said Yen Chen, senior economist at the Center for Automotive Research in Ann Arbor, Mich. And one of the most likely sources of additional sales -- consumers aged 25 to 34 -- has been declining as a share of the full-time work force, even as older workers retire.
Chen said today at the 2014 Management Briefing Seminars that rising vehicle sales historically have gone hand-in-hand with rising full-time employment rates.
“That’s the reason we didn’t have very strong growth since the end of the recession,” Chen said.
He forecasted U.S. sales of 16.3 million light vehicles for 2014, up from 15.6 million in 2013. But he predicted that household debt will hold sales below 17 million through 2018. The latest U.S. annualized sales rate, from July, was 16.5 million units.
Chen forecasted sales of 16.9 million in 2018.
He said the share of consumers aged 16 to 24 with jobs has fallen significantly since 2000. And a significant number of people aged 25 to 34 did not return to work after the recession.
“That affects their ability to buy their first house and their ability to spend their income on motor vehicles,” he said. “They delay their purchase of a motor vehicle as a result.”