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The forgotten job market: The underemployed


The underemployed are those who are working part-time who would rather work full-time.

The underemployed are those who are working part-time who would rather work full-time.

The unemployment rate remained relatively steady in March at 5 percent with around 200,000 U.S. jobs added. While 5 percent is up from 4.9 percent in February, ABC News reports that the reason behind this trend is that there were more job seekers in the market, and not all were hired immediately. Many remain confident that this rate will remain steady over the next few months. Others believe that this steady unemployment rate is indicative of a healing economy.

“The resilience of the labor market suggests that the economy is not in any serious trouble,” Paul Ashworth, chief U.S. economist at Capital Economics, told ABC News.

Is there more than just unemployed and employed?
While the job market may look to be on the rebound, industry analysts are taking closer looks at the hidden figures behind the normal unemployment rate. To uncover this, each week Gallup polls track the number of adults who are unemployed, employed and underemployed.

When including this last category, the true unemployment rate as of April 7, 2016, is 9.9 percent. Though the unemployment rate may be at an all time low, The Washington Post reports that this underemployment rate is still high and a growing problem in this country. Furthermore, many people and hiring managers may be unfamiliar with the term underemployed, as it is typically referred to as the forgotten job market.

Unemployment may be down, but what about underemployment?
Underemployment traditionally refers to individuals who are either overqualified for their current position or are working part-time when they would rather hold a full-time position. The first classification of workers in this category, overqualified workers, are employees who hold a relatively low-skill position. For example, these workers would hold a postsecondary or even postgraduate degree, yet work as a waitress, bartender or lower-level office position.

“Hiring managers may be unfamiliar with the term underemployed.”

The two most common demographics of workers in this category include immigrants or college graduates. While immigrant job seekers may be limited by their English language proficiency, a prejudiced job market or non-transferable degrees, college graduates may struggle to find jobs due to a lack or experience, good grades or availability of entry-level positions.

Meanwhile, even for those finding work in their field, they may be discouraged to only find part-time positions available. Instead of earning a sizable income in their industry, they are forced to support themselves or their family on half the earnings they were expecting to make. While there are numerous reasons that could cause this problem, some of the most prevalent include a lack of available job opportunities, poor child care service offerings, lack of public transportation and more.

What does this mean for hiring managers?
Hiring managers who are struggling to find qualified hires in an overly competitive job market should appeal to the underemployed for their next open positions. As they might not be actively seeking out other job opportunities, hiring managers might have to reevaluate their process to reach a greater audience. Initiating employee referral programs, advertising on social media or other personal marketing efforts may draw in these job-seekers.

Once the underemployed apply at your company, try implementing pre employment testing into your hiring process. These tests provide reliable results, showcasing whether or not applicants possess the necessary skills for the job. Interviews and resumes can be misleading, which is why your company needs employment tests to hire the best candidates faster and without the normal hiring process hassle. Contact EmployTest today to learn more!