Abstract
Workers in occupations that underutilize their education or training, experience, and skills are underemployed. This worker underemployment presents economic development opportunities through selective job creation and industry growth. Businesses benefit because such underemployment information provides more realistic estimates of the available labor pool in an area. It also provides the potential to improve firm output and profits by using the information to enhance productivity and performance, as well as reduce turnover. However, the U.S. Bureau of Labor Statistics’ (BLS) measures of labor underutilization do not consider underemployment among full-time workers and thus provide incomplete information on the full extent of underemployment. Four surveys on Alabama's working age population show that underemployment is present among full-time workers and is a multiple of the unemployment rate. We combine underemployment estimated from the surveys with the U-5 BLS measure of labor underutilization to develop a more comprehensive measure called CMLU5. The methods developed in this study can be applied to labor markets at the county level and above anywhere in the United States.
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*Samuel N. Addy is a Research Economist at the University of Alabama. He joined the Center for Business and Economic Research (CBER) in 1998 and assumed the position of Director in 2007. He works with CBER's economic research program and has directed and conducted economic impact studies, assessments and analyses of Alabama's workforce, fiscal policy, socioeconomic analysis for transportation and other development projects, and environmental and climate change issues. Addy is Vice-President of the Alabama chapter of NABE. A native of Ghana, he obtained a B.Sc. in Metallurgical Engineering from the University of Science and Technology. He holds an M.S. in Mineral Engineering from the University of Minnesota, and a Ph.D. in Mineral Economics from The Pennsylvania State University.Michaël Bonnal is Assistant Professor of Economics at the University of Tennessee at Chattanooga (UTC). Prior to being at UTC, he was a postdoctoral researcher at the University of Alabama's Center for Business and Economic Research. His research interests lie in the fields of labor economics, regional economics, economic development, and economic growth. He holds a Ph.D. in Economics from the University of Alabama, masters degrees from the University of Louisiana Monroe, the University of Alabama, and the University of Paris-Est Marne-La-Vallée. A native of France, he received his undergraduate education from the University of Leeds and the University of Paris-Est Marne-La-Vallée.Cristina Lira is an independent researcher in Berkeley, California. Her research interests are in the areas of labor economics, regional economics, applied econometrics, international trade, income inequality, and social networks. She received a Ph.D. in Economics and a masters degree in finance from the University of Alabama. A native of Italy, Lira received a B.S. in Economics from Bocconi Univeristy in Milan and a Doctoral Degree in Economics from the University of Milan.
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Addy, S., Bonnal, M. & Lira, C. Toward a More Comprehensive Measure of Labor Underutilization: The Alabama Case. Bus Econ 47, 214–227 (2012). https://doi.org/10.1057/be.2012.16
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DOI: https://doi.org/10.1057/be.2012.16