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Underemployment in the UK Revisited

Author

Listed:
  • David N.F. Bell
  • David G. Blanchflower

Abstract

This paper addresses the issue of underemployment in the UK labour market – the demand for hours of work is less than workers’ willingness to supply extra hours. Workers would like to work more hours, but there is insufficient product demand to justify additional hours. This phenomenon has been evident in the UK labour market for some time, but has grown significantly during the Great Recession. In this paper, we develop a new index of underemployment which is intended to combine indicators of excess capacity on the extensive (jobs) and intensive (hours) margins of the labour market. This index continued to increase during 2012, though unemployment was stable. The paper also investigates the microeconomic determinants of underemployment, finding that it is particularly prevalent among the young and unqualified.

Suggested Citation

  • David N.F. Bell & David G. Blanchflower, 2013. "Underemployment in the UK Revisited," National Institute Economic Review, National Institute of Economic and Social Research, vol. 224(1), pages 8-22, May.
    • Handle: RePEc:sae:niesru:v:224:y:2013:i:1:p:f8-f22
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    Citations

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    Cited by:

    1. Mousteri, Victoria & Daly, Michael & Delaney, Liam, 2020. "Underemployment and psychological distress: Propensity score and fixed effects estimates from two large UK samples," Social Science & Medicine, Elsevier, vol. 244(C).
    2. David Blanchflower & Alex Bryson & Jackson Spurling, 2024. "The wage curve after the Great Recession," Economica, London School of Economics and Political Science, vol. 91(362), pages 653-668, April.
    3. David N. F. Bell & David G. Blanchflower, 2021. "Underemployment in the United States and Europe," ILR Review, Cornell University, ILR School, vol. 74(1), pages 56-94, January.
    4. David Miles, 2014. "Monetary Policy and Forward Guidance in the UK," Manchester School, University of Manchester, vol. 82(S1), pages 44-59, September.
    5. D’Amuri, Francesco & De Philippis, Marta & Guglielminetti, Elisa & Lo Bello, Salvatore, 2022. "Slack and prices during Covid-19: Accounting for labor market participation," Labour Economics, Elsevier, vol. 75(C).
    6. Francesco D'Amuri & Marta De Philippis & Elisa Guglielminetti & Salvatore Lo Bello, 2021. "Natural unemployment and activity rates: flow-based determinants and implications for price dynamics," Questioni di Economia e Finanza (Occasional Papers) 599, Bank of Italy, Economic Research and International Relations Area.
    7. Congregado, Emilio & Garcia-Clemente, Javier & Rubino, Nicola & Vilchez, Inmaculada, 2023. "Testing hysteresis for the US and UK involuntary part-time employment," MPRA Paper 118115, University Library of Munich, Germany.
    8. Roberto Roson & Emanuela Ghignoni, 2023. "A Numerical Simulation of Educational Mismatch in the Italian Labor Market," Working Papers 2023: 15, Department of Economics, University of Venice "Ca' Foscari".
    9. Roberto Roson & Emanuela Ghignoni, 2023. "A Numerical Simulation of Educational Mismatch in the Italian Labor Market," Working Papers in Public Economics 241, University of Rome La Sapienza, Department of Economics and Law.
    10. Robert A. Hart, 2023. "Hours vs employment in response to demand shocks," IZA World of Labor, Institute of Labor Economics (IZA), pages 393-393, February.
    11. R. Jason Faberman & Andreas I. Mueller & Ayşegül Şahin* & Giorgio Topa, 2020. "The Shadow Margins of Labor Market Slack," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 52(S2), pages 355-391, December.
    12. Daniel Schaefer & Carl Singleton, 2020. "Recent Changes in British Wage Inequality: Evidence from Large Firms and Occupations," Scottish Journal of Political Economy, Scottish Economic Society, vol. 67(1), pages 100-125, February.
    13. Roberto Roson, 2022. "Underemployment in a Computable General Equilibrium Model," Working Papers 2022:17, Department of Economics, University of Venice "Ca' Foscari".
    14. Daniel Schaefer & Carl Singleton, 2017. "Recent Changes in British Wage Inequality: Evidence from Firms and Occupations," 2017 Meeting Papers 459, Society for Economic Dynamics.
    15. Bell, David N.F. & Rutherford, Alasdair C., 2013. "Older workers and working time," The Journal of the Economics of Ageing, Elsevier, vol. 1, pages 28-34.
    16. Youngjin Woo & Euijune Kim & Jaewon Lim, 2017. "The Impact of Education and R&D Investment on Regional Economic Growth," Sustainability, MDPI, vol. 9(5), pages 1-18, April.
    17. Daniel Francois Meyer & Precious Mncayi, 2021. "An Analysis of Underemployment among Young Graduates: The Case of a Higher Education Institution in South Africa," Economies, MDPI, vol. 9(4), pages 1-16, December.
    18. Yasemin ÖZERKEK & Fatma DİDİN SÖNMEZ, 2021. "Labor Underutilization in European Countries: Some Facts About Age and Gender," Yildiz Social Science Review, Yildiz Technical University, vol. 7(2), pages 137-146, December .
    19. Juan Acosta-Ballesteros & María del Pilar Osorno-del Rosal & Olga María Rodríguez-Rodríguez, 2021. "Measuring the effect of gender segregation on the gender gap in time-related underemployment," Journal for Labour Market Research, Springer;Institute for Employment Research/ Institut für Arbeitsmarkt- und Berufsforschung (IAB), vol. 55(1), pages 1-16, December.
    20. Bell, David N.F. & Blanchflower, David G., 2019. "The well-being of the overemployed and the underemployed and the rise in depression in the UK," Journal of Economic Behavior & Organization, Elsevier, vol. 161(C), pages 180-196.
    21. Olga María Rodríguez Rodríguez & Juan Acosta Ballesteros & María del Pilar Osorno del Rosal, 2016. "Subempleo y ocupación de los jóvenes y ciclo económico: La importancia del nivel educativo y la especialidad," Investigaciones de Economía de la Educación volume 11, in: José Manuel Cordero Ferrera & Rosa Simancas Rodríguez (ed.), Investigaciones de Economía de la Educación 11, edition 1, volume 11, chapter 39, pages 699-718, Asociación de Economía de la Educación.
    22. Daniel Schaefer & Carl Singleton, 2017. "Real Wages and Hours in the Great Recession: Evidence from Firms and their Entry-Level Jobs," CESifo Working Paper Series 6766, CESifo.

    More about this item

    Keywords

    Unemployment; underemployment; under-utilisation;
    All these keywords.

    JEL classification:

    • J01 - Labor and Demographic Economics - - General - - - Labor Economics: General
    • J11 - Labor and Demographic Economics - - Demographic Economics - - - Demographic Trends, Macroeconomic Effects, and Forecasts
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • J38 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Public Policy
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search

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