In a recent article discussing various measures of the labor market, the author delved into the question of whether the labor market was truly thriving beyond just the headline unemployment rate. While exploring alternative unemployment rates, labor force participation, employment rates, and unemployment insurance claims, the author ultimately concluded that the labor market appeared to be in good shape.
However, a new concern has emerged regarding job growth numbers: part-time employment. This issue has been gaining traction on social media platforms like Twitter, with some individuals suggesting that a significant portion of job creation in recent times has been in the part-time category. This assertion was reiterated by the author’s co-blogger, who mentioned in a recent post that a substantial portion of this year’s job growth has been in part-time roles.
To address this concern, it is essential to first understand the context of part-time employment in the broader labor market. According to data from the Bureau of Labor Statistics (BLS), approximately 17 percent of workers in the US are classified as part-time employees, defined as working less than 35 hours per week. While this figure may seem higher compared to recent years, it actually falls within the range of historical norms, with the exception of periods following prolonged economic expansions.
The spike in part-time employment can largely be attributed to the significant job losses experienced by part-time workers at the onset of the pandemic. Data from the BLS shows that part-time employment took a substantial hit in April 2020, dropping by nearly 30 percent, compared to a lesser decline in full-time employment. While part-time employment has since rebounded, it has taken longer to recover fully compared to full-time roles, particularly in service occupations.
The slow recovery in service occupations, which account for a significant portion of part-time employment, has contributed to the recent growth in part-time jobs. Despite the higher-than-usual proportion of part-time job creation in the current labor market, this trend is not necessarily cause for alarm. In fact, it may indicate a positive development for consumers, as it reflects a gradual return to pre-pandemic levels in certain sectors.
Looking ahead, it is expected that job growth will increasingly shift towards full-time roles as the economy continues to recover. However, challenges persist in the service sector, where employers are facing difficulties in hiring staff, leading to slower service and potential consumer frustrations. This trend has been encapsulated in the concept of “skimpflation,” where consumers experience reduced service quality amidst rising inflation.
In conclusion, while the prevalence of part-time employment in recent job growth figures may raise concerns for some, it is important to consider the broader context of the labor market dynamics. The return of part-time roles could be a positive indicator of economic recovery, particularly in sectors that have been slower to bounce back. As the economy evolves, it will be crucial to monitor these trends and their implications for both businesses and consumers.
