Underemployment

Published Oct 26, 2023

Definition of Underemployment

Underemployment refers to a situation where individuals are employed in jobs that do not fully utilize their skills, qualifications, or availability to work. This can include part-time workers who want to work full-time, individuals who are overqualified for their current positions, or those who are working in jobs that don’t match their education or training.

Example

Let’s say there is a highly skilled graphic designer named Sarah who has a bachelor’s degree in design and several years of experience. However, due to a slump in the job market, Sarah struggles to find a full-time position in her field. Eventually, she settles for a part-time job at a local printing shop.

Although Sarah is employed, she is underemployed because her skills and qualifications are not fully utilized in her current role. She is only able to use a fraction of her design skills and is not able to work as much as she would like to. This situation leads to unfulfilled potential and an income level that may not meet her needs.

Why Underemployment Matters

Underemployment can have significant impacts on individuals and the economy as a whole. For individuals, being underemployed can lead to job dissatisfaction, reduced income, and limited career advancement opportunities. It can also contribute to financial stress and hinder personal and professional growth.

From an economic perspective, underemployment means that there is a mismatch between available skills and job opportunities. This inefficiency can result in reduced productivity and economic output. Moreover, underutilizing talent and skills can hinder innovation and overall economic development.

Addressing underemployment requires a comprehensive approach that involves providing better job matching services, promoting skill development and training programs, and creating an environment where individuals can fully utilize their skills and abilities in the workforce. By doing so, we can enhance job satisfaction, economic growth, and overall well-being.