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Ian Brinkley
Economic Advisor
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Ian Brinkley

Underemployment among part-timers – how the UK compares internationally

Authors: Ian Brinkley Ian Brinkley

15 May 2013

The latest labour market figures show that underemployment remains a serious problem in the UK economy. More sophisticated measures by Blanchflower and Bell look at the demand for hours for all workers and take into account those workers who would prefer to work less as well as those who want to work more; however, the labour market statistics published this month have a more readily available indicator - the number of people in part-time jobs who say they want a full-time job.

The number has increased to just over 1.4 million, or just under 18% of part-time workers and 4.7% of all those in work (comparing the three months to January-march 2013  with the previous three months). In the same period in 2008, the number of people in part-time jobs who wanted full-time work was just 0.7 million, or just under 10% of all those in part-time employment.

But is this problem unique to the UK? The EU Commission has recently published some comparative data that suggests that while the problem is widespread, it is worse in the UK than in many other EU States.

The Commission uses a slightly different definition of employment, including all those between the ages of 15 and 74 (the ONS includes all those 16 or over), and includes all part-time workers who want additional hours and not just those who want a full-time job – so the figures are not directly comparable with the latest UK statistics.

The EU Commission estimates that in 2012, about 24% of all part-time workers in the UK wanted more hours . This compares with just over 21% across the EU27. The problem is much worse in some Eastern and Southern European States, especially Greece and Spain, but much less severe in many Northern European economies. For example, only 13% of part-time workers wanted to work more hours in Denmark and only 3% in the Netherlands.

However, in some economies with very high levels of underemployment, the number of part-time jobs is much lower than in Britain, so the impact on the wider labour market is less severe. Part-time workers who want more work are a bigger share of the workforce in the UK than in any other EU State except Ireland and Spain.  The share in the UK is 6.5% compared with 4.3 % across the EU27.

This is not simply because the UK has more part-time jobs than most EU States. Part-time workers are more likely to say they want more hours in Britain than in other EU States where part-time work is at similar levels. In the Netherlands, where nearly 50% of the workforce are part-time, part-time workers who want more hours represent just 1.6% of all in work. Germany, Belgium, Denmark, Austria and Sweden all have fewer part-time workers wanting more work than the UK. Outside the EU, Commission estimates suggest the same is true for Norway and Switzerland.

The results for European economies with high levels of part-time employment are shown in the table below.

INVOLUNTARY PART TIME WORKING IN EUROPEAN ECONOMIES WITH HIGH LEVELS OF PART TIME JOBS

 

% part time in workforce

% part timers who want more work

% who want more work as share of workforce

Ireland

23.9%

33.6%

8.0%

UK

27.0%

24.1%

6.5%

Switzerland

35.6%

16.9%

6.0%

Sweden

26.5%

19.3%

5.1%

Germany

26.5%

17.1%

4.5%

Belgium

25.0%

14.0%

3.5%

Austria

25.5%

13.7%

3.5%

Denmark

25.7%

12.7%

3.3%

Norway

28.1%

11.1%

3.1%

Netherlands

49.8%

  3.3%

1.6%

EU 27 average

19.9%

21.4%

4.3%

Source: EU Commission

It is sometimes suggested that it is better to have high levels of part-time workers who want more hours than higher levels of unemployment. This is true in the short term, although the longer underemployment persists, the more it is likely to be damaging if people are taking jobs that do not make good use of their skills.  However, the exact relationship between involuntary part-time work and unemployment levels has yet to be established. It is not obvious from the EU Commission figures that countries with high levels of involuntary part-time work have on average lower unemployment rates than countries with low rates of involuntary part-time employment.

Comments in Chronological Order (Total 15 Comments)

Jason Loughrey

20 May 2013 12:26PM

Thanks Ian for highlighting this. In terms of the underemployment statistics in Ireland, we have data going back to just the third quarter of 2008. At that time, there were 31,500 males and 63,700 females in underemployment. In the final quarter of last year, the total number of males in underemployment reached 65,200 and 80,600 for females. The increase in the numbers leaving the labour force (approx. 170,000) has been much greater than the increase in underemployment so we probably need to think about the number exiting the labour force when considering the unemployment-underemployment relationship.

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