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Why leaders must tackle underemployment

30th May 2018
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If we take even a casual glance at the UK’s underemployment problem, we can glean some valuable insights into the country’s stubborn productivity woes.

There’s one, major reason why the UK is an attractive place for employers: our employee-protection laws aren’t nearly as strong as those in many of the European countries that are out-competing us.

The casualisation of labour – through such arrangements as zero-hours contracts – is indicative of that.

People are getting work – but is it meaningful work?

Is it work that they can rely upon? And does it pay fairly?

Signs that the UK’s employment picture is nothing like as rosy as the headlines would have us believe emerged loud and clear from a recent Business Insider article.

Using official figures from the Office for National Statistics (ONS), Citi Research found that the proportion of UK workers who describe themselves as underemployed – ie, stuck in part-time work because they’re struggling to secure full-time hours – has grown by roughly 50% since the pivotal financial crisis years of 2008 and 2009.

Stuck in a rut

According to the article, the ONS data suggests that “chronic underemployment has replaced the role outright joblessness used to play in the labour market”.

The defining schism of inequality in Britain today, it notes, “is the divide between those with full-time jobs and workers stuck in the poorly paid gig economy”.

A key concern here is that research shows underemployment has a negative impact upon career progression.

Two years ago, University of Texas researcher David Pedulla filed 2,420 fictitious job applications across 1,210 real job opportunities – and found “compelling evidence” that taking a job below one’s skill level has a penalising effect, regardless of one’s gender.

Pedulla concluded that “part-time work severely hurts the job prospects of men”, while hiring managers broadly regard female part-timers as less competent than their full-time counterparts.

This presents two, major problems: i) how can the underemployed get out of that rut? And ii) what part should leaders play in tackling underemployment?

21st Century outlook

Underemployment doesn’t mean that individuals don’t have opportunities to keep learning.  There are copious, free resources online that will help them to learn new things and develop their talents.

There are so many Massive Open Online Courses (MOOCs) from which we can learn almost anything we want at no cost. The Institute’s website contains a lot of helpful information that can be accessed without committing to the full membership fee.  MOOCs have only been around for 10 years, but have transformed the way we think about learning content.

As for leaders, it’s crucial that when they are making recruitment or promotion decisions, they have the courage to consider all the possible variations of who could do the job – and what it takes to do the job.

They must apply an open-minded, 21st Century, flexible-working mindset to the process of imagining who they may want.

As the fascinating University of Texas research shows, the application process does tend to leave disadvantaged groups out in the cold through prejudice and bias.

But if leaders adopt a more businesslike outlook and refuse to narrow their own talent pools, we will hear a lot less talk of a talent shortage. And sluggish UK productivity, for that matter.

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