Underemployed workers

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Employed people who want to work more hours or worked reduced hours, including preferred hours and usual hours not worked, and underemployment ratios.

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Reference period
May 2022
Released
24/06/2022
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Key statistics

In Feb 2022:

  • 821,000 part-time workers were underemployed - they preferred and were available to work more hours (20.1 per cent of all part-time workers).
  • About half of the underemployed part-time workers preferred to work full-time hours (47.5 per cent).
  • Half of the underemployed part-time workers preferred an extra 10 hours or less (median extra hours preferred).
  • 44.4 per cent of underemployed part-time workers spent a year or more working in a job with insufficient hours.  

This Underemployed workers release is divided into two parts. The first part is based on part-time underemployed workers from the February 2022 Participation, Job Search and Mobility survey.

Other data collected from the Participation, Job Search and Mobility survey are published in:

The second part is based on the analytical series of underemployed workers from the May 2022 Labour Force survey. This analytical series is based on an expanded scope for the definition of underemployed beyond the standard headline measure, similar to the data published in Tables 24 and 25 of the monthly Labour Force release.

Part 1: Part-time underemployment, Feb 2022

In February 2022, there were 821,000 underemployed part-time workers who preferred to work more hours (20.1 per cent of all part-time workers). This was a fall of 189,000 from 1,010,000 underemployed part-time workers last year in February 2021 (which was 24.9 per cent of all part-time workers). 

The number of men and women who were underemployed part-time workers both fell between February 2021 and February 2022.

  • Men fell by 95,000 from 421,000 to 326,000 (32.1 per cent to 25.8 per cent).
  • Women fell by 94,000 from 589,000 to 494,000 (21.4 per cent to 17.6 per cent).

 

    Extra hours preferred

    In February 2022, about half of the underemployed part-time workers preferred to work full-time hours (47.5 per cent or 389,700 underemployed part-time workers). The other half preferred to work more hours but remain working part-time (52.5 per cent, or 431,200 underemployed part-time workers.

    • Men aged 25-44 years were most likely to prefer to work full-time (73.3 per cent).
    • Women aged 65 years and over were least likely to prefer to work full-time (8.1 per cent).

     

    In February 2022, half of the underemployed part-time workers preferred an extra 10 hours or less (median extra hours preferred).

    • Women aged 65 years and over preferred the least amount of extra hours (median extra hours = 6.8 hours).
    • Men aged 25-44 years preferred the most amount of extra hours (median extra hours = 13 hours).

     

    Duration of insufficient hours

    In February 2022, 364,200 underemployed part-time workers spent a year or more working in a job with insufficient hours (44.4 per cent of all underemployed part-time workers).  

    Half of all underemployed part-time workers worked with insufficient hours for 39 weeks or less (median duration of insufficient hours).

    Looking for more work or more hours

    In February 2022, of the 821,000 underemployed part-time workers, just under half (44.6 per cent) took active steps to look for additional hours. The top three steps taken to look for more hours were:

    • Wrote, phoned or applied in person to an employer (30.0 per cent).
    • Answered an ad for a job on the Internet, in a newspaper, etc (26.9 per cent).
    • Asked current employer for more work (25.5 per cent).

    For underemployed part-time workers who looked for work or more hours in February 2022, the top five difficulties in finding more work were:

    • "Other" difficulties (most likely related to difficulties associated with the pandemic) - 14.5 per cent.
    • Too many applicants for available jobs - 12.1 per cent (down from 19.6 per cent in February 2021).
    • No vacancies in line of work - 10.3 per cent.
    • Insufficient work experience - 7.7 per cent.
    • Lacked necessary skills or education - 7.4 per cent.

    If a suitable job had been offered, 14.4 per cent were prepared to move interstate, and 17.9 per cent were prepared to move within their state or territory.

    Just over half of underemployed part-time workers (53.6 per cent) preferred not to change employers in order to work more hours.

    Part 2: Underemployment, May 2022

    Comparison with underemployment measures in Labour Force, Australia

    The following analysis explores underemployment using an expanded scope and is additional to the measures found in Labour Force, Australia; Labour Force, Australia, Detailed publications and data published from the Participation, Job Search and Mobility Survey.

    It includes all people indicating:

    • they had their hours reduced (e.g. they were stood down or their employer had insufficient work for them); or
    • they had a preference to work more hours than they usually work.

    In contrast, the headline underemployment estimates published in Labour Force, Australia, which are based on long-standing international standards, include two groups: part-time employed who would prefer, and are available for, more hours than they usually work, plus full-time employed who worked part-time hours for economic reasons.

    The ABS recommends using the data below as a supplementary analytical series for understanding the underemployed population.

    Employed people can be underemployed either because:

    • they worked less than their usual hours for economic reasons (i.e. due to being 'stood down, or there was insufficient or no work available - Hours reduced (sometimes referred to as the 'Cyclical underemployed')
    • they would prefer (and are available) to work more hours than they usually work - Prefers more hours (sometimes referred to as the 'Structural underemployed')

    Of the 13.6 million employed people in May 2022, 1,470,500 were underemployed. Of these:

    • 305,100 people had their hours reduced - 115,100 were employed full-time and 190,100 employed part-time
    • 1,273,600 people preferred more hours - 538,100 were employed full-time and 735,500 employed part-time

    There were 108,200 people who were in both categories - they had their hours reduced to less than usual and also preferred to work more than usual hours.

    Diagram 1: Expanded scope of underemployment

    Diagram highlighting what additional populations are added in the expanded scope of underemployment
    In the bottom row, there are two components that form the headline measure of underemployment. On the left is the group "Full-time workers who worked part-time for economic reasons" which was 65,200 workers in May 2022. On the right is the group "Part-time workers who prefer more hours" which was 735,500 workers in May 2022. These two groups are added together to get the headline measure of Underemployment, which was 800,700 workers in May 2022. Returning to the left group "Full-time workers who worked part-time for economic reasons" which was 65,200 in May 2022, two more groups are added vertically in a column to expand the scope of underemployment on the basis of people who worked less hours for economic reasons. The first additional group is "Full-time workers who worked fewer full-time hours for economic reasons," which was an additional 49,900 workers in May 2022. The second additional group was "Part-time workers who worked fewer part-time hours for economic reasons," which was an additional 190,100 workers. These three groups are added together to form the total number of workers who were "Cyclical Underemployed," which was 305,100 workers in May 2022. Returning to the right group on the bottom row "Part-time workers who prefer more hours" which was 735,500 workers in May 2022, two more groups are added vertically in a column to expand the scope of underemployment on the basis of people who preferred to work more hours than usual. The first additional group is "Part-time workers who prefer to work more hours than usual and worked full-time hours in the reference week," which was an additional 42,600 workers in May 2022. The second additional group was "Full-time workers who prefer more hours," which was an additional 495,500 workers. These three groups are added together to form the total number of workers who were "Structural Underemployed," which was 1,273,600 workers in May 2022. These two totals of their respective columns, Cyclical Underemployed on the left with 305,100 workers in May 2022 and Structural underemployed on the right with 1,273,600 workers are combined together to get the expanded measure of Underemployment, which was 1,470,500 workers in May 2022. You might notice that 305,100 plus 1,273,600 doesn't equal 1,470,500. This is because there is some overlap between Cyclical and Structural Underemployment. There was 108,200 workers in May 2022 who were in both categories, that is, they worked fewer hours for economic reasons (cyclical underemployed), and also would prefer to work more hours than usual (structural underemployed).

    Note: There are people who preferred more hours and also had their hours reduced, that is, they worked less hours than usual, and also prefer to work more than their usual hours - so the sum of the people who preferred more hours and people who had their hours reduced does not equal the total underemployed.

    While Chart 6 shows a 'headcount measure' of underemployment (the number of people who are underemployed) an alternative way to look at underemployment is through a 'volume measure' of underemployment - the number of 'hours not worked' by underemployed people.

    Chart 7 shows the weekly hours not worked of underemployed people. The weekly hours not worked are:

    • the number of additional hours they would prefer, and are available, to work (preferred more hours)
    • the difference between usual hours and the hours actually worked in the reference week (hours reduced)

    In May 2022, there were a total of 16.9 million hours not worked. Of these:

    • 14.1 million hours were not worked by people who preferred more hours - i.e. the additional hours preferred
    • 2.9 million hours were not worked by people who had their hours reduced - i.e. the usual hours not worked for economic reasons

    Hours not worked by people who had their hours reduced is the difference between their usual hours and the hours actually worked in the reference week, and the hours not worked by people who preferred more hours is the additional hours preferred.

    In May 2022, the headcount underemployment ratio was 10.8% while the hours-based underemployment ratio was considerably lower at 3.4%.

    The headcount underemployment ratio is the number of underemployed as a proportion of all employed.
    The hours-based underemployment ratio is the hours not worked as a proportion of the potential hours of employed people (i.e. the hours usually worked of all employed plus the additional hours preferred of the structurally underemployed).

    Hours-based measures of underemployment are generally lower than headcount measures, as the hours-based measures account for the extent of a person's underemployment whereas a headcount measure counts all underemployed people the same.

    The headcount underemployment ratio is the number of underemployed as a proportion of all employed.
    The hours-based underemployment ratio is the hours not worked as a proportion of the potential hours of employed people (i.e. the hours usually worked of all employed plus the additional hours preferred by the structurally underemployed).

    Sex and Age

    Note: There are people who preferred more hours and also had their hours reduced, that is, they worked less hours than usual, and also prefer to work more than their usual hours - so the sum of the people who preferred more hours and the people who had their hours reduced does not equal the total underemployed.

    In May 2022, 10.8% of all employed people were underemployed (the underemployment ratio). Since July 2014 (the first month this expanded data are available for), employed women have generally been slightly more likely to be underemployed than men. However, since the start of the COVID-19 pandemic the underemployment ratio has generally been higher for men.

    Note: There are people who preferred more hours and also had their hours reduced, that is, they worked less hours than usual, and also prefer to work more than their usual hours - so the sum of the people who preferred more hours and the people who had their hours reduced ratio does not equal the total underemployment ratio.

    Full-time / part-time status

    Chart 13 shows the number of part-time and full-time employed people who are cyclically or structurally underemployed. In May 2022, there were 627,600 underemployed full-time workers and 842,900 underemployed part-time workers.

    Of the underemployed full-time workers:

    • 115,100 had their hours reduced
    • 538,100 preferred more hours

    Amongst underemployed part-time workers:

    • 190,100 had their hours reduced
    • 735,500 preferred more hours

    Note: There are people who preferred more hours and also had their hours reduced, that is, they worked less hours than usual, and also prefer to work more than their usual hours - so the sum of the people who preferred more hours and the people who had their hours reduced does not equal the total underemployed.

    Hours not worked by people who had their hours reduced is the difference between usual hours and the hours worked in the reference week, and the hours not worked by people who preferred more hours is the additional hours preferred.

    Preferred hours

    People who were underemployed in May 2022 because they preferred to work more hours than their usual hours, on average:

    • usually worked 27 hours a week
    • would have preferred to work an additional 11 hours a week

    People who were underemployed in May 2022 because they had their hours reduced for economic reasons, on average:

    • actually worked 18 hours a week
    • would have worked an additional 9 hours a week

    Occupation

    Industry

    Data downloads

    Table 1. Cyclical and structural underemployment of full-time and part-time workers

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    Table 2. Extended measures of underutilisation

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    Table 3. Underemployment status of full-time and part-time workers

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    Table 4. Part-time workers who prefer more hours

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    Table 5. Characteristics of part-time workers who prefer more hours

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    Table 6. Duration of insufficient hours of underemployed part-time workers

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    Table 7. Number of extra weekly hours preferred by underemployed part-time workers

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    Table 8. Main difficulty in finding more work of underemployed part-time workers

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    All tables

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    Relative standard errors, Tables 2 to 8

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    Previous catalogue number

    This release uses ABS catalogue number 6229.0*.

    Data from this release was previously published in:

     

    * Note: Catalogue number 6229.0 was previously used for Survey of Persons Registered with the CES as Unemployed, Mar 1977.

    ** Note: Catalogue number 6226.0 was previously used for School Leavers, 1970 to 1974: their Employment Status and Education Experience, May 1975.

    Methodology

    Participation, Job Search and Mobility, Australia methodology, February 2022