Underemployment: The Hidden Underbelly (Infographic)

Snag released its annual State of the Hourly Worker Report, shining light on a record number of employed Americans not making a living wage. Findings reveal 38 percent of workers earning $20 or less an hour consider themselves underemployed and underemployment is most prevalent among restaurant employees over any other industry. (The report defines the underemployed as those who are currently employed hourly or rely on gig work as their primary source of income, but still need more hours to make ends meet.)

Nearly half of restaurant workers (47 percent) consider themselves underemployed.

For the underemployed one job often isn’t enough to cover basic living expenses and they are twice as likely to accumulate debt. The majority (80 percent) of underemployed workers are willing to work multiple jobs to get the hours they need, though 74 percent would prefer to work a single full-time job. More than half (54 percent) of underemployed workers are actively searching for a better full-time job, and a third (32 percent) are already working a side hustle such as Uber or Lyft to supplement their income.

“Hourly jobs account for nearly 60 percent of the American workforce and 94 percent of net new job growth is hourly. People need to wake up. Underemployment is a big problem,” said Peter Harrison, CEO of Snag. “It’s deceiving. Most see unemployment hovering around 4 percent as a signal that Americans are well employed and thriving, but this is simply not the case.”

The underemployed need more work than they receive at their part-time jobs, but sustaining a second or third job can be difficult when shifts are unpredictable. Schedules often vary from week to week, forcing hourly workers to live paycheck to paycheck. Every week, 40 percent of underemployed workers see their schedule fluctuate by five hours. One in five (21 percent) get less than a day’s notice before a schedule change.

Peter Harrison

Key findings of the report:

  • Women account for 70 percent of the underemployed.
  • Half of Millennials (52 percent) are underemployed followed by nearly a third (29 percent) of Gen X.
  • Nearly half of restaurant workers (47 percent) consider themselves underemployed followed by retail workers (41 percent) and hospitality workers (38 percent).
  • Of the underemployed, one in four work over 35 hours a week.
  • On average, full-time workers make $3 an hour more than their part-time counterparts and receive more perks and benefits including paid time off, health insurance and 401K.

“The Bureau of Labor Statistics (BLS) by its own admission, is not yet capable of measuring the impacts of the gig economy. Given the explosive growth of this segment, this is a grave omission,” added Harrison.

For its State of the Hourly Worker Report, Snag surveyed 2,100 hourly workers across all industries making $20 or less per hour. Check out the report and the infographic below.