The underemployment rate rose in Australia in 2020
Job Market

Underemployment: A crisis in the market

The underemployment rate rose from 8.8 per cent at the beginning of the year, to 11.2 per cent as of August.

This year, we’ve been talking a lot about unemployment. But in our office, we’d argue underemployment should be the topic of conversation.

Underemployment includes those who are working less hours than they want to.

What is underemployment?

For ABS’ purposes, underemployment is a blanket term for those who:

  • Would like to work more hours than they currently work.
  • Have had their hours reduced (this year, likely due to economic reasons).

As recruiters, we’ve seen first-hand a few other types of underemployment:

  • Those overqualified for a job.
  • Those who have accepted a position that doesn’t meet their needs, either financial or related to career aspirations.
  • Those whose skills are not being utilised in their current position.

Underemployment in Australia

The underemployment rate rose from 8.8 per cent at the beginning of the year, to 11.2 per cent as of August (ABS). In comparison, the unemployment rate from this same period fluctuated from 5.2 per cent to 6.8 per cent. So, Australians might have been able to retain their jobs during the COVID-19 crisis, but it’s likely their wallets (and hours) took a big hit.

As for those who compromised career aspirations or took a position that didn’t make use of their training, it’s a little harder to ascertain from a report.

Underemployment can include those who are overqualified for a position.

Tips for those underemployed

  1. Target specific companies

If you are able, take a job with a company or in a sector where you would like to work long-term. Even if this is a more junior role or position with an entirely different function to your training, it’s much easier to move laterally inside of a company.

  1. Tailor your CV to the role

If you’re applying for a position outside of your usual skillset, ensure you tailor your experience to suit the essentials of the role advertised. It’s also important you convey your motivations about why you want to take this step. (See: 7 tips to make your CV easy to skim and How to write a CV for the construction industry.)

If you are highly qualified and apply for a junior role, some hiring managers might be quick to assume you won’t enjoy the role as it is not challenging. They may have concerns about your movement from being a manager to becoming managed. Set your intentions from the outset so there’s no room for ill assumptions can be made.

  1. Diversify your skill set

If you are unable to find work in your industry, it’s important to still work towards your dream company or job. Consider making use of many of the free training programs currently on offer. Put some research into what software programs your dream company use (it might be MYOB, Python or HubSpot) and train on these. This will give you a leg-up in an interview when you can prove you have relevant experience.


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