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Underemployment in the UK Revisited

Published online by Cambridge University Press:  26 March 2020

David N.F. Bell  and
David G. Blanchflower
David N.F. Bell*
Affiliation:
Stirling Management School, University of Stirling; IZA; Centre for Population Change
David G. Blanchflower
Affiliation:
Dartmouth College; Stirling Management School, University of Stirling; Peterson Institute for International Economics; IZA; NBER
*
E-mail: dnfb1@stir.ac.uk.
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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.

Keywords

Unemploymentunderemploymentunder-utilisationJ01J11J21J23J38J64
Type
Commentary
Information
National Institute Economic Review , Volume 224 , May 2013 , pp. F8 - F22
Copyright
Copyright © 2013 National Institute of Economic and Social Research

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References

Bell, D.N.F and Blanchflower, D.G. (2010), ‘UK unemployment in the Great Recession’, National Institute Economic Review, October, 214, R3–R25.CrossRefGoogle Scholar
Bell, D.N.F. and Blanchflower, D.G. (2011), ‘UK underemployment in the Great Recession’, National Institute Economic Review, January, 215, R23–33.CrossRefGoogle Scholar
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