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Underemployment in the UK Revisited


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


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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    References listed on IDEAS

    1. Carol Corrado & Charles Hulten & Daniel Sichel, 2005. "Measuring Capital and Technology: An Expanded Framework," NBER Chapters,in: Measuring Capital in the New Economy, pages 11-46 National Bureau of Economic Research, Inc.
    2. John G. Fernald, 2015. "Productivity and Potential Output before, during, and after the Great Recession," NBER Macroeconomics Annual, University of Chicago Press, vol. 29(1), pages 1-51.
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    Cited by:

    1. 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 Group Munich.
    2. David Miles, 2014. "Monetary Policy and Forward Guidance in the UK," Manchester School, University of Manchester, vol. 82(S1), pages 44-59, September.
    3. repec:eee:joecag:v:1-2:y:2013:i::p:28-34 is not listed on IDEAS

    More about this item


    Unemployment; underemployment; under-utilisation;

    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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