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Finding solutions: what will break the underemployment trap?

In our third employability roundtable, we look at solutions for youth underemployment, specifically concentrating on what policy makers and businesses can do to help support job-seekers and employees. In this blog, Catch22 Director of Communications, Melissa Milner, outlines the conversation and recommendations made.

26 July 2022

In the third of our roundtables on underemployment, our attention switched to what policy makers and businesses could be doing to help tackle the issue of youth underemployment.  We also discussed the importance of empowering job seekers to know their rights when it comes to escaping the underemployment trap.

Recognising the characteristics of underemployment

Our Horizons employability programme, which is one of the first programmes to tackle the issue of underemployment, uses the following criteria to define underemployment:

  • On a low wage (less than the London living wage)
  • On a zero hours contract
  • On a part-time contract (less than 16 hours a week)
  • A temporary contact
  • Unstable hours or shift pattern (at risk of redundancy or unemployment)
  • Overqualified
  • Limited opportunities to progress

Of course not everyone who experiences one or more of these conditions may define themselves as underemployed; temporary or zero hours contracts may work for some people’s circumstances. But these at least provide a basis for businesses and policy makers to begin to address it.

Recognising the barriers

As we’ve highlighted in previous blogs, the circumstances which lead someone to be underemployed can vary greatly. It may be caring responsibilities, disability, urgent financial need or indeed lack of knowledge about what rights they have.

That’s why blanket policies to tackle underemployment are unlikely to make a dent in the problem.

Instead, recognising the barriers and shaping policy to address them specifically.

Policy interventions

Currently, there is a tendency for Job Centre Plus to place job seekers into ‘any’ job, rather than a role that may be more appropriate and sustainable. Sanctions that encourage this approach almost always affect marginalised groups more, and directly lead to underemployment.

Local government plays a critical role, with Local Skills Improvement Plans (LSIPs) key to linking local employers with Further Education providers to open up local jobs. Similarly, Youth Hubs have the potential to connect young people with regional job opportunities that are sustainable.

There also needs to be a much more personalised approach to jobs support; taking into account an individual’s circumstances, skillset and ambitions, and matching them to the jobs available.

There are much broader policies that need to be addressed to get to the root of some of the barriers to underemployment. For example, improved paternity leave, where both parents are entitled to paid time off for the first few months of their child’s life, might help prevent new mothers being forced into part time jobs to balance childcare demands. An uplift in Universal Credit might mean some individuals would be afforded some choice in terms of the jobs they take, rather than being forced into taking any job in order to ensure an income.

The role of business

With lack of progression a key feature of underemployment, there is an onus on businesses to provide development opportunities for staff – not only to aid retention, but also to get the most out of employees.

Acknowledging the individual circumstances that employees face and being flexible enough to adapt work patterns, is of course another way employers can contribute to tackling underemployment. 

The rights of the individual

Making sure job seekers and employees know their rights is another key part of tackling underemployment. For many workers, Unions play a vital role in this, and proposed anti-Union roles present a real threat.

Companies need to think about how they communicate their policies to employees – not overcomplicating them – and should be transparent about what they’re entitled to.

We’ll be pulling together the thoughts and findings from our three underemployment roundtables and publishing a short report in the autumn.


With thanks to contributions from: Youth Employment UK, The Princes Trust, West Midlands Combined Authority, and participants from our Horizons programme.