More Americans face underemployment

Marketplace Staff Feb 4, 2010

More Americans face underemployment

Marketplace Staff Feb 4, 2010


Kai Ryssdal: I mentioned as we got going today that the January jobs report is going to come out tomorrow. The official unemployment rate will probably be somewhere within a couple decimal points of 10 percent. But there is a whole other group of people who’re holding on to work by a thread. They’re called underemployed. People who’ve been laid-off, and who can now only find part-time jobs or fewer hours. If you count them, the full measure of slack in the labor market is closer to 20 percent.

From WCPN in Cleveland, Dan Bobkoff reports.

DAN BOBKOFF: Pam Giguere has long worked in human resources. These days, she’s working just 20 hours a week at a staffing agency in Brunswick, Ohio, called The Reserves Network. It’s not an ideal situation, but her new bosses Kent McNickle and Marilyn Szendrey definitely appreciate her help.

KENT McNICKLE: We can take advantage of her expertise.

MARILYN SZENDREY: She’s educated, she’s skilled.

McNICKLE: Quite an asset to us right now in her role.

Giguere ended up here after she lost her job at an auto-parts producer at the height of the recession.

PAM GIGUERE: On tax day, April 15, I was downsized.

As an HR person, she knew what to expect.

GIGUERE: That I would probably be asked to leave right away, and it’s just very shocking, very, very shocking.

So she gathered her things and called her connections at The Reserves Network, which had been her client.

GIGUERE: They knew I was looking and Marilyn said I’ll watch for any opportunity. We’d love to have you work in our office.

It took a few months, but the agency found her a part-time gig. She now helps the team place temp workers. But it’s really an entry-level position. And, a huge drop in income.

GIGUERE: It’s enormous. Not even 50 percent.

That puts Pam Giguere among the nearly nine million Americans who are underemployed. They’re still working, but only part time.

ANDREW SUM: Not only do they receive this large cutback in hours, but we also find these individuals also take large cuts in their pay. So their hourly wage also falls.

Andrew Sum is a labor economist at Northeastern University in Boston. He says underemployment has more than doubled in the last two years, a bigger rise than at any time since World War II.

SUM: This is far greater than any of the previous five recessions that we had in the U.S. So this problem has become extraordinarily intense.

Sum says there are two kinds of underemployment. Employees still working at the same company, but with their hours drastically cut back. Or, those like Pam Giguere. They were laid off and could only get part-time work.

SUM: That group is the one that typically undergoes the large wage decline.

But experts say finding some work, even if it’s beneath you, can help long term.

Debra Stitt is a recruiter in Cleveland.

Debra STITT: People are really taking a step back, saying, OK, you know, 10 years ago I did that. I can do that again.

With so many people both out of work and underemployed, Stitt says companies can be harsh.

STITT: I have employers that say, “Don’t send me anyone that’s unemployed. Don’t want to talk to them.” Right or wrong, that’s the thinking, because they think good employees are not laid off.

Pam Giguere holds out hope that continuing to work in her field, even for low pay, will help make her more attractive to potential employers.

GIGUERE: The good thing is I know that it all takes time. I know that they are overwhelmed with resumes. People without skills apply for your jobs, and it’s very overwhelming. And, it does take time. And it is disheartening.

After all those years in HR, she knows how it works on both sides.

In Cleveland, I’m Dan Bobkoff for Marketplace.

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