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New data series on involuntary part-time work.

The number of nonagricultural workers "on part-time schedules for economic reasons," shows a strong relationship to business cycle trends, according to seasonally adjusted data from the Current Population Survey. The number and proportion of persons involuntarily working part time--sometimes referred to as the "partially unemployed"--generally rise during a recession and decline during a recovery period. In a comprehensive examination and analysis of these data which appeared in the June 1983 Monthly Labor Review, Robert W. Bednarzik demonstrated that during cyclical periods, the incidence of economic part-time work moves in the same direction as, but leads, movements in the civilian unemployment rate. Bednarzik explained that such part-time employment typically rises before unemployment begins to increase during a recession, mainly because employers tend to reduce hours of work when possible before laying off employees. During recovery periods, employers usually restore the hours of those on shortened workweeks before rehiring laid-off workers. The main focus of Bednarzik's analysis, however, was the relationship and variation in cyclical behavior of the two main causes of involuntary part-time work, cutbacks in weekly hours due to slack work and failure to find full-time work, both of which were seasonally adjusted specifically for his study.

Following up on Bednarzik's analysis, BLS tested the cyclical sensitivity and accuracy of the new series and confirmed that these data captured more clearly the distinctions between the concepts of persons working part time involuntarily than did the existing published series, which divided the total number into those who "usually work full time" and those who "usually work part time." Thus, to provide data users with more relevant series that can isolate the main causes of part-time work, BLS has replaced the existing usual full- and part-time series with the new series. Effective with data for January 1985, the new series are published in monthly issues of "The Employment Situation" news release and Employment and Earnings, and, beginning with this issue, are also published in table 4 in the Current Labor Statistics section of the Monthly Labor Review. Data are published for all persons (in agriculture and nonagricultural industries combined) as well as for persons in nonagricultural industries only. (The former series were limited to workers in nonagricultural industries.) Time series based on the new definitions are available back to 1955 and can be obtained from BLS.

The new series clearly show different cyclical behavior, which, in turn, illustrates different underlying labor market problems. The more cyclical "slack work" series reflects short-run adjustments made by firms to minimize layoffs and subsequent recalls or hirings. Thus, slack work rises sharply during economic downturns, but shows rapid improvement during the early stages of recovery. The "failure to find full-time work" series reflect the experience, skills, and training of workers; the match of available workers to work schedules; and the types and locations of job openings, as well as the general state of the economy. The "failure to find" series is clearly less cyclical. Indeed, in contrast to the "slack work" component, it typically rises during the early stages of a recovery, probably because many unemployed workers find and accept part-time jobs (perhaps after exhausting unemployment insurance benefits) as a better alternative to remaining fully unemployed without compensation.

Recent data illustrate this point. The following tabulation shows the number of persons (seasonally adjusted) and the percent of total civilian employment on part-time schedules for economic reasons during September of 1982 and 1983 and January 1985:

The number of persons involuntarily working part time due to slack work dropped by 1 million in the first 12 months of recovery from the series high in September 1982 and by only 265,000 in the subsequent 16 months (through January 1985). During the first 12 months of recovery, the proportion of the total employed comprised by persons on short workweeks due to slack work fell from 3.7 to 2.6 percent. In January 1985, the group accounted for 2.3 percent of the employed. This pattern of decline was similar to that following the recovery from the 1973-75 recession. Thus, it seems clear that this component shows rapid improvement early in the recovery, as employers rest ore hours of those workers retained but with reduced workweeks before adding new workers, and then improves more slowly as the recovery matures. In contrast, the other major component--persons who can only find part-time jobs--showed no improvement early in the recovery period; indeed, it rose slightly. It did moderate later, but not by the magnitude of the decline in the slack-work component.
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Author:Hamel, Harvey R.
Publication:Monthly Labor Review
Date:Mar 1, 1985
Previous Article:Employment in recession and recovery: a demographic flow analysis.
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