The author empirically examines the effect on youth employment of government-mandated employer-provided benefits. In particular, he investigates the effect of unemployment compensation insurance taxes and workers' compensation insurance mandates on the employment of youths (aged 16–19) and young adults (aged 20–24 and 25–34). An analysis of time series state aggregate data for the years 1982–89 indicates that a one percentage point increase in the employer's cost of workers' compensation insurance reduced employment for both teenagers and young adults by about 1.5 percentage points. Unemployment insurance taxes significantly decreased the employment of teenagers, but not that of young adults.
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