How to Avoid Underemployment

Underemployment is a widespread concern in the labor force and a phenomenon that not only impacts individual workers but also the broader economy. Underemployment causes amongst affected employees and impacts the business by not being able to harness the full abilities of workers either through underusing the employee by giving short hours or by not leveraging the true capabilities of a worker.

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What is Underemployment?

refers to the situation where employees are underused or under utilized at work, performing roles below their skill level, either in part-time roles when they seek full-time work or in positions that don’t utilize their education, skills or experience. This phenomenon represents a waste of human capital and a constraint on economic growth.

The Underemployment Spectrum

1. Skilled workers in unskilled jobs: Skilled professionals accept lower positions to stay employed usually caused by lack of opportunities in a job market because of oversupply of labor or low demand for their skills.
2. Part-time workers seeking full-time roles: These workers settle for part-time jobs even though they need full-time positions but are not able to secure full-time roles and therefore go underused.
3. Overqualified employees: When employees work in roles that don’t require their qualifications, it leads to underemployment. Common with popular university degrees that lack a robust job market.

How Does Underemployment Arise?

There are several macroeconomic factors contributing to the rise of underemployment. Here are some of the key factors.

1. Economic Conditions: Economic downturns can force individuals to accept lesser roles where any income is preferable over no income. Business cycles force companies to downsize in a downturn where they are forced to cut costs and reduce employee hours or have less skilled work to assign to their workforce.
2. Mismatch of Skills: The disconnection between the skills workers possess and what employers need can lead to underemployment. Rapidly and can mean as soon as someone graduates their skills are already outdated. Those workers who do not have the resources or means to retrain themselves are generally susceptible to underemployment.
3. Education System Issues: The education system may not adequately prepare individuals for the current job market by focusing on the wrong set of skills and knowledge that are applicable in the workplace. Misaligned incentives between underutilized degrees in the workforce and university courses on offer cause a mismatch of graduates to available positions.

Impact on Businesses

The effects of underemployment on businesses are numerous and detrimental to economic productivity as a whole.

• Lower Productivity: Underemployed workers may lack motivation, leading to lower productivity due to feelings of disillusionment.
• Increased Turnover: Dissatisfaction from a lack of may cause employees to leave as soon as they find a better opportunity, resulting in high turnover.
• Damaged Reputation: Businesses known for under employing may find it harder to attract skilled workers. Workplace review sites like make it clear when a business is failing to utilize their workers well.

Impact on Employees

Employees are negatively affected from underemployment in various ways.

• Financial Strain: Earning less than their qualifications merit causes financial difficulties and make it hard to pay off student debts incurred from earning their qualifications.
• Career Stagnation: Stuck in inappropriate roles, professionals may find their careers stalling and feel a loss of purpose and direction, impacting heavily on their mental health.
• Psychological Stress: The mismatch between skills and work may lead to frustration and anxiety for the worker.

What to Do If You Are Underemployed?

Are you underemployed in your current job? Here’s some methods to mitigate the chance of underemployment and ideas on becoming fully employed.

• Assess Your Situation: Determine if you are indeed underemployed by analyzing your skills and qualifications against the responsibilities and tasks of your current role.
• Upgrade Your Skills: to bridge the skill gap might open up better opportunities. Sometimes filling these gaps is all that is required to show initiative and give you the edge in a job hiring process.
• Network Actively: Building connections with professionals in your field may lead to more suitable positions. Leverage LinkedIn and employ to build a useful network.
• Consider a Career Change: Sometimes we have to honestly , accept the cost we have paid either in time or monetarily, and make a change in career path as the best way to utilize your skills fully. It never hurts to browse job openings year round to identify roles or careers that will better utilize your skillset and fill you with purpose and job satisfaction.
• Seek Professional Help: Career counselors can provide personalized advice and support in finding the right job as they have real-world experience and stories of many clients who faced and overcame these situations.

Ending Thoughts

Underemployment is a complex issue affecting both businesses and employees in significant ways but by understanding the reasons surrounding it and taking strategic actions, both parties can mitigate its impact and pursue full employment. Businesses must strive to match skills appropriately, give sufficient hours for a livable wage and individuals should continually assess and adapt to the market’s needs. By addressing underemployment in the workforce proactively, we can create a more robust, efficient, and satisfied workforce that contributes positively to economic growth and produce a happier, more fulfilled society ideally driven by purpose.