Teenagers hung out on street corners and on the steps of boarded-up buildings in impoverished downtown Newburgh one blisteringly hot August day this year.

With the economy still in the doldrums and government summer work programs losing funding, there was little for them to do in this town about 60 miles north of New York City.

They were not alone: It was the worst summer on record for U.S. teenagers seeking work, delaying millions of young Americans' entry into the labor force and creating a generation that history suggests may be scarred by the experience.

Only a quarter of the 16.7 million Americans between the ages of 16 and 19 had jobs this summer, the fewest since at least World War II and compared with 45 percent in 2000.

Graphic: http://r.reuters.com/fyc63s

The numbers are especially bad for black male teens from families who earn less than $40,000 a year: only 12 percent had summer work in June and July, according to Northeastern University's Center for Labor Market Studies.

I want to work and I'm good for anything, said Ashante Coston, 16, from Newburgh, who was spending the day helping his mother look after his baby brother.

Last summer, he worked at a youth center, but this year, he has had no luck finding work.

The teen summer employment rate has plummeted by almost a third since 2006 before the financial crisis and recession hit, and any meager recovery for the overall jobs market appears to have left out teens altogether.

Teens without work experience are going to find it more difficult to find full-time work in the future and are likely to earn less when they do, said Andrew Sum, professor at Northeastern University and one of America's top experts on youth employment.

The problem is not confined to the United States. With youth playing a leading role in protests across Europe and in the Middle East there have been some high-profile calls for world leaders to tackle youth unemployment. Former UK Prime Minister Gordon Brown has repeatedly called it an epidemic that cannot be ignored.

Tim Barnicle, a former assistant secretary of labor in the Clinton administration, hopes President Barack Obama will acknowledge the problem when he lays out a new jobs policy on Thursday.

How do you ensure an experienced, disciplined workforce when you lose years of preparation? Barnicle asked.

There's also the social aspect: You're suggesting to them they are not worth that much, when at 19 they can't even get crummy jobs.

There are wider consequences too: a lack of morale may sap energy out of the generation on whose shoulders the burden of paying for the retirements of the baby boomers will lie.

A GENERATION STUNG BY JOBLESSNESS

In some poverty-stricken communities, social workers worry that with nothing to do and no options to earn money, some teens will turn to crime.

That's a particular worry for towns like Newburgh, which has long struggled with poverty and violence. Money available for summer work programs there has more than halved since 2009.

What happens is they then look for other ways to earn money -- and that can mean drug dealing or violence, said Marie Gulari, county director for NHS Human Services.

No recent crime data for Newburgh was available and some signs of a recent pickup in crime in parts of New York City are as yet statistically inconclusive.

But there is worrying anecdotal evidence. Philadelphia, for example, in early August ordered anyone under 18 to be off the streets by 9 p.m. on Friday and Saturday nights after flash mobs rioted and beat store owners.

There's some research that links crime and unemployment. It's not a majority experience, but its still troubling, said Katherine Newman, dean of the Johns Hopkins University School of Arts and Sciences.

For teens in low-income communities, the main problem is that a lack of work experience damages their prospects for moving out of poverty, said Newman. They get trapped in the low-wage sector.

Most young people who take part in summer work programs don't have access to social networks they would need to get higher-paying jobs, said Robert Sainz, assistant general manager in the City of Los Angeles Community Development Department.

Their parents are in the service industry and that's what they know, he said.

When these young people get discouraged, stop looking for work, they're not coming from families who can help support them and that's going to lead to trouble down the line, he said.

In Los Angeles, federal stimulus money helped create jobs for 9,000 kids through a summer work program last year. This year, the city scraped together only enough funds for 3,800. The waiting list was 10,000 strong, said Sainz. Most of the teens used the money they earned to buy basics like food and school supplies.

Employment not only gives teens exposure to the world of work, it also makes it less likely they will drop out of high school or end up delinquent, said Northeastern University's Sum.

One possible reason the U.S. has not seen youth protests may be that Americans are more likely to blame themselves rather than the system, said Richard Sennett, a sociology professor at New York University and the London School of Economics.

In America, there's often a self-reproach: 'I didn't make it, I didn't play my cards right', he said. The worry there is that you have a generation that just gives up and nothing seems possible for them.

(Editing by Martin Howell)

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