Effects of Unemployment/Underemployment

Unemployed and underemployed individuals face challenges that get worse and worse the longer a person is out of work. Common disadvantages for individuals include:

Reduced income

• A direct result of unemployment and underemployment is reduced income; losing the wages from a job immediately slashes the individual’s available income. Underemployment brings in too little money to meet the individual or family’s needs.
• After losing a job, people often rely on their savings or are forced to borrow money for basic needs – food, shelter, clothing, transportation. If the primary worker in the family is unemployed or underemployed, the difficulties are more serious – they must find a way to support themselves and their families.
• With underemployment at 6.6%, low-income workers can no longer support their households.  Recent increases to minimum wage – to $15 per hour – were initially encouraging, but inflation has driven up the cost of basic needs so high that even increased wages cannot keep up with the cost of living.
  
  

Health problems

Employment problems often come with stress-related health issues such as headaches, heart disease, high blood pressure, diabetes, back pain and insomnia. Without the health insurance typically provided to full-time employees, people often skip expensive self-pay doctor visits and medications.

Unemployed and underemployed people also cannot afford preventative measures like healthy foods and gym memberships, which also increases health risks.

Negative familial effects

The whole family suffers when household members are unemployed or underemployed. According to the Society for the Psychological Study of Social Issues, the negative impacts seriously affect spouses and children in a number of ways:

• Mothers’ emotional health
• Low infant birth weight
• Lower academic performance for children
• Low self-esteem for all family members
• Lower future earnings of all family members
  
  

Effects on Society

High unemployment and underemployment rates lead to higher poverty rates and poorer neighborhoods with sub-standard housing, poorly funded schools and social programs, food deserts, scarce recreational activities, and difficulty accessing public transportation.

Employment Disparities

By January 2023, overall unemployment in US had dropped to 3.4% from the staggering numbers – as high as 12.9% – during the COVID pandemic. Florida’s unemployment rate currently stands at 2.5%, which sounds pretty good, but among people of color, the news is not as encouraging. Unemployment stands at 5.5% for African Americans and at 3.9% among Latinos.

There are many reasons why the unemployment rate among minorities is different than the national average. Historically, immigration policies, the struggle for civil rights, education disparities, and high rates of incarceration for people of color all impact the unemployment picture.

Underemployment rates are on the rise in the US; with gas and grocery prices steadily rising, part-time, low-paying or low-skill jobs just aren’t enough to support a household.  Older workers and immigrants often are underemployed, unable to compete with recent graduates and younger workers, with more up-to-date skills and willing to work for less.