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The Underemployment-Job Satisfaction Nexus: A Study of Part-Time Employment in Australia

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Abstract

This study investigates the association between underemployment and job satisfaction among part-time workers across the period 2002–2014, given that both are increasingly important phenomena within the Australian labour market, and currently under-researched. We delve deeper into this nexus by extending the focus of job satisfaction beyond overall job satisfaction, including another five workplace satisfaction domains. This is done to see if the association is sensitive to specific aspects of work. We find that being underemployed is negatively associated with job satisfaction, across all workplace satisfaction domains. Further, we find that the underemployment-job satisfaction nexus to be somewhat gendered. Specifically, we report that underemployed males have a greater negative association with job satisfaction relative to their female peers. These results suggest that part-time underemployment is a significant (amounting to around 94% of the entire underemployed people in Australia) but well-hidden issue within the Australian labour market, and the consequence of this for job satisfaction are pronounced.

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Notes

  1. Our definition of underemployment is time-related—a measure of labour underutilisation that exists when workers work fewer hours than they preferred. This definition is different from “inadequate employment” which contains three specific types, namely skill-related underemployment, income-related underemployment and excessive working hours (see Wilkins and Wooden 2011).

  2. Research on the underemployment-job satisfaction nexus has generally investigated overall job satisfaction in the main, which may hide variations in specific aspects of job satisfaction (Kifle et al. 2014a, b). See “Appendix Box 1” for a detailed exposition of the job satisfaction domains used in this study.

  3. We note that Wilkins (2004, 2006, 2007) and Wooden et al. (2009) do touch upon this association as part of a more encompassing study on Australian underemployment. They do not, however, study it in detail and discuss the nexus as one of a multitude of facets of the wider underemployment issue.

  4. The labour underutilisation rate = unemployment rate + underemployment rate (ABS 2014a).

  5. Note, these figures refer to the underemployment rate of both full-time and part-time workers. This paper will however concentrate on the latter group only.

  6. Given that they would prefer to work more hours, and hence would have greater inter-connectedness with society should their preference be granted.

  7. In Table 2, the proportion of employees who are underemployed does not show the probabilities of transition into and out of underemployment. To obtain this information we computed transition probabilities for part-time employees, and our results show that the probability of transition from being underemployed for one period to non-underemployed for the next period was higher comparing to transition probability from being non-underemployed for one period to underemployed for the next period. Results are available on request.

  8. Note that in the self-complete questionnaire (see Sect. 4), the various job satisfaction domains are based on a seven (1–7) point scale instead.

  9. Neglecting anticipation effects can cause time-varying bias to estimated results. For more information on anticipation effect refer to Powdthavee (2011).

  10. In (2) \(\varPhi\) represents standard normal cumulative distribution function.

  11. Each regression controlled for a rich set of personal, employment, family and educational characteristics noted in “Appendix Box 1”. Full results are available in the supplementary material.

  12. We also estimated the effect of moving into and out of underemployment on job satisfaction, and our results show that the effect is symmetric. In absolute terms, the magnitude of transition-based job satisfaction differential is small. Full results are available on request.

  13. Each regression controlled for a rich set of personal, employment, family and educational characteristics noted in “Appendix Box A1”. Full results are available in the supplementary material. These eight permutations are (1) Full-time Non-underemployed Male (2) Full-time Non-underemployed Female, (3) Full-time Underemployed Male, (4) Full-time Underemployed Female, (5) Part-time Non-underemployed Male, (6) our omitted case of Part-time Non-underemployed Female followed by our two main variables of interest, (7) Part-time Underemployed Male and (8) Part-time Underemployed Female.

  14. The number of observations differ because the self-complete questionnaire is not monitored when filled in, and as such respondents are not prompted to review missing responses. Full results are available on request.

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Acknowledgements

This paper uses unit record data from the Household, Income and Labour Dynamics in Australia (HILDA) survey. The HILDA Project was initiated and is funded by the Australian Government Department of Social Services (DSS) and is managed by the Melbourne Institute of Applied Economic and Social Research (Melbourne Institute). The findings and views reported in this paper, however, are those of the authors and should not be attributed to either DSS or the Melbourne Institute.

Author information

Authors and Affiliations

  1. School of Economics, University of Queensland, Brisbane, Australia

    T. Kifle

  2. Department of Accounting, Finance and Economics, Griffith University, Brisbane, Australia

    P. Kler

  3. ANU Centre for Social Research and Methods, Australian National University, Canberra, Australia

    S. Shankar

Authors
  1. T. Kifle
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  2. P. Kler
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  3. S. Shankar
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Corresponding author

Correspondence to S. Shankar.

Electronic supplementary material

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Supplementary material 1 (DOCX 33 kb)

Appendix

Appendix

Appendix Box A1: workplace satisfaction question in wave 1 of the HILDA person questionnaire

E36

I now have some questions about how satisfied or dissatisfied you are with different aspects of your job

If not currently employed: These questions refer to the most recent job you were working in the last 7 days

I am going to read out a list of different aspects of your job and, using the scale on SHOWCARD 36, I want you to pick a number between 0 and 10 to indicate how satisfied or dissatisfied you are with the following aspects of your job. The more satisfied you are, the higher the number you should pick. The less satisfied you are, the lower the number

a

Your total pay

b

Your job security

c

The work itself (what you do)

d

The hours you work

e

The flexibility available to balance work

and non-work commitments

f

All things considered, how satisfied are

you with your job?

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Kifle, T., Kler, P. & Shankar, S. The Underemployment-Job Satisfaction Nexus: A Study of Part-Time Employment in Australia. Soc Indic Res 143, 233–249 (2019). https://doi.org/10.1007/s11205-018-1976-2

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