Underemployment refers to an employment situation that is insufficient in some important way for the worker, relative to a standard.  In layman terms, it’s a measure of those employed people whose potential is not fully explored.

In the May results 900’000 employed people were deemed underemployed, this is about 30% higher than the number of unemployed people for the same period.  As a proportion of the labour force in operation during this time, this represents approximately 7.30% of the workforce.

This term is normally broken down into three areas

Underutilisation of Skills

This basically refers to employees who are working in positions where their experience  or qualifications are not being utilised.   They may have a degree from another country or specific industry experience but cannot find work in this area and such have been forced into accepting work in another industry or profession.  Their education, experience, or skills are beyond the requirements of the job.  Another example would be holding a part-time job despite desiring full-time work.

Under use of Economic Capacity

Refers to localities where employment can be hard to obtain/maintain due to a lack of opportunities, the geographical locations or impacted by such things as no public transport or childcare being available.  It becomes harder to find/keep work than it is to remain inactive and register as unemployed.  In this situation, people often become victims of circumstance and find it hard to break free from the cycle.

Under use of Employed Workers (over staffing)

Accounting firms are an example of this, for the majority of the year the majority of staff are underutilised but come tax time it’s all hands on deck, it doesn’t make sense to do redundancies every year so the quiet times are absorbed and filled where they can.  Tourism, agriculture and even fire fighting are all in similar situations, not needed all the time but need them on standby should the requirement arise.

It is specifically in this are that labour hire can be a solution to reducing underemployment.  By engaging a labour hire and recruitment company to assist with these peak times, companies can reduce their annual overheads by not engaging staff permanently but retaining their core structure and utilising the flexibility of labour hire to engage suitable skilled employees during these times.

The next step is finding the right labour hire and recruitment company.  Just call Concept.

For more information regards the Labour Force from the Bureau of Statistics you can follow this link (http://www.abs.gov.au/AUSSTATS/abs@.nsf/mf/6202.0?opendocument#from-banner=LN )or search abs online.