Underemployed? You’re Not Alone

You've likely heard about the high number of Americans who are currently unemployed. You may even be among their statistics. But are you familiar with another growing class of workers called the "underemployed"?

For example, is your grocery store cashier really a certified teacher or mechanic? Is the receptionist at your office moonlighting as a bartender because your company only gave her part-time hours when she wanted more? Is your daughter working three jobs because she can't find full-time employment in the art world after earning an expensive college degree in that field?

These cases may seem extreme, but they are, in fact, the reality facing today's underemployed workers who struggle to manage expenses and who are often defined as: 

• Overqualified or overeducated workers: These people have a high skill set or experience level that doesn't match their job. However, they take on these jobs - or any job, really - to help pay their bills. A trained medical professional earning a living as a taxi driver is a good example of this type of worker. College graduates and immigrants whose foreign credentials may not transfer here in the States are among the groups affected here. 
• Part-timers who desire full-time work: These workers hold several jobs in an attempt to make enough money to pay their bills. While they'd prefer a 40-hour work week, perhaps their employer wants to avoid paying out benefits, so it only hires part-timers. This class of workers could also be constrained by poor employment opportunities in their communities or lack access to the transportation needed to take them to neighboring areas where jobs are more plentiful.
• Unemployed workers: Some underemployment definitions also include individuals who don't have a job but are seeking employment and are ready to begin work immediately.

So where are the hardest hit areas? According to a February 2012 Gallup poll, workers in Florida, California, Michigan, Mississippi and Nevada face underemployment rates of 21% and higher. That means that 1 out of every 5 people is underemployed in these states.

Now, admittedly, some people desire underemployment. Think of a ladder-climbing career executive who chooses to stay home with her newborn and work part-time only. However, what about underemployed people who don't want to be underemployed - especially if they face mounting debt? What can they do to improve their situations?

If you find yourself underemployed, and you don't want to be, here are a few tips on how to manage this difficult time in your life: 

• Use your time wisely: Fill those hours you'd like to spend working on productive projects or acquiring skills that will make you more employable or enable your transition to an occupation with large job-growth potential. For example, enroll in a course at your local community college to gain a new certification or advance your computer skills. Alternatively, volunteer at your dream job. This type of work won't help with your debt, but you might make a worthy connection and learn about a new job opportunity.
• Network: Tell everyone you know that you're looking for a different job. Talk with anyone who will listen (this means at the gym, park, grocery store, with friends, etc.) and use social media like Facebook to spread that word that you're looking for a new job. Have a 30-second speech prepared and well-practiced, so you can succinctly summarize your skills and capabilities when meeting prospective networking contacts.
• Remain optimistic: If you are actually working, even if in a limited capacity, use that income wisely and keep chipping away at your debt and daily expenses. Also, a part-time position could always transition into full-time employment. Keep working hard and proving to your boss that it's worth keeping you around.
• Tighten your belt: If you're living on a reduced paycheck or on unemployment benefits, cut the fat out of your budget and lower your personal cost of living. Can you eliminate any of your regular monthly expenses, even if just temporarily? Also, if you have to use credit cards, do so only minimally. The last thing you want is to add new financial headaches to the stresses of an unfavorable job situation.

For more advice on how to manage expenses and work off debt while underemployed, click on these budget planning and cost-cutting tips.

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Jenny Realo

Jenny Realo is the Chief Product Officer for CareOne Services, Inc. In our A Straight Talk on Debt blog, Jenny provides her insights and updates based on her 20+ years of experience in the financial service industry. Jenny is dedicated consumer advocate and places much of her focus on consumer protections in relation to creditor and industry regulatory changes.

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