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New Report Shows The Underlying Issues In The American Workforce

Over the last forty years we have lost millions of high paying manufacturing jobs. Many of these jobs did not require any advanced degrees and any specialized training was down by the employer or the union.

At the same time parents began pushing their children to go to college because in the 1980’s college educated workers were in short supply and were paid accordingly.

Now almost every employer is requiring some level of college education to even be considered for employment. This has created a new problem, underemployment.

Everyone knows about unemployment, the percent of workers who are unemployed and are currently seeking employment. Currently we have a national unemployment rate of 5.5%. Considering that in October of 2009, deep into the great recession, our national unemployment peaked at 10%, 5.5% means we have made great progress.

But have we really? Yes, the number of unemployed people in the U.S. has been cut in half but that is not the entire story.

During the recession when millions were out of work, struggling to pay their bills, people would take any job they could. People with bachelors’ degrees were working at McDonalds just to pay their outrageous student loans. This is what we refer to as underemployment, where a worker is employed in a job below their education and skill level.

underemployment_headerToday, PayScale Inc released a new report, “Underemployed: The War on the American Worker,” highlighting America’s underemployment problem.

“There are many economic indicators followed by business and policy leaders to gauge the health of an economy. One notable such report is the monthly jobs report produced by the Bureau of Labor Statistics, which includes unemployment figures. However, unemployment only tells part of the story. At PayScale, we believe another crucial indicator is underemployment – people who are either working at jobs that don’t leverage their education or seeking full-time work, but are working part-time. Therefore, we created our latest report tying underemployment figures to educational choices, jobs, and gender,” said Katie Bardaro, Lead Economist, PayScale.

To conduct their research PayScale interviewed nearly one million people over a two-year time frame starting in March of 2014.

underemplyment_chart05aPayScale found that 46% of those surveyed consider themselves underemployed. Of these respondents, 76% say they are not using their education or training while 24% say they are working only part-time but would like full-time work.

“There are two underlying themes in this report: The importance of education and the persistence of the gender gap. The report notes underemployment decreases as educational attainment increases. Also, in addition to a pay gap and an opportunities gap, we see the gender gap materialize in underemployment as well: Women report a greater percentage of underemployment than their male counterparts,” added Bardaro.

Education level does make a difference. PayScale found that Medical Doctors have the lowest level of underemployment at 30%. That is a vast difference when compared to the 50% who claim to be underemployed with an Associates Degree.

The report shows that just over 40% of those with a Masters in Business Administration (MBA) report being underemployed. Of the underemployed MBA degree holders, 90% reported they are not using their education and training.

underemplyment_chart10When we break down the numbers by gender, women have a slight edge over men in underemployment. 49% of woman report being underemployed compared to 42% of men. Women are also 7% more likely to be underemployed due to working part-time when they really want to be working full-time.

“These statistics may be a reflection of the gender opportunity gap,” wrote PayScale. “According to PayScale’s research, as employees climb the corporate ladder, men are often promoted more quickly than women, and women generally report more negative feelings about job satisfaction, job stress, and communication with their employers. (Learn more about the gender opportunity gap and the gender pay gap in PayScale’s report, Inside the Gender Pay Gap.)”

You can find out more about PayScale’s report here.

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About Matt Murray

Matt Murray is the creator and an author on the NH Labor News. He is a union member and advocate for labor and progressive politics. He also works with other unions and members to help spread our message. Follow him on Twitter @NHLabor_News
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