Employment and Earnings Inadequacy: A New Social Indicator

An Analysis of the Economic Impact of the Service Sector on Underemployment in Major Metropolitan Areas in the United States

“…The poverty thresholds are $9,265 for primary earners and $4,608 for secondary earners . As in previous research, all secondary earners in households with family incomes above the median were not classified as underemployed to reduce the possibility of including `voluntary' underemployment due to work-leisure tradeoffs among secondary earners (Levitan and Taggart, 1974) .…”

“…Since the mid-1960s, researchers have proposed a number of approaches to the definition and measurement of underemployment ranging from 'subemployment' indices (Wirtz, 1967 ;Miller, 1973 ;Vietorisz, Mier, and Giblin, 1975) to `employment and earnings inadequacy' indices (Levitan and Taggart, 1974) . Most underemployment measures differ in their relative emphasis on two different aspects of the underemployment concept : (1) inadequate work time, and (2) inadequate earnings .…”

“…A major issue has been the inadequacy of the traditional concepts of employment, unemployment, labour force participation, income inequality and poverty to address growing concerns over labour market hardships -that is, economic hardships caused by the inability of workers to earn adequate incomes through the labour market (Levitan and Taggart, 1974 ;Taggart, 1982) .…”

“…As in previous research it was assumed that one family member should be able to earn sufficient income to support a family of four . All other family members in the labour force should be able to earn a level of income sufficient to support themselves (Levitan and Taggart, 1974) . Therefore, all labour force participants were divided into primary and secondary earners.…”

The Relationships Among Labor‐force Participation, Service‐sector Employment, and Underemployment*

“…In this section, the important measure of underemployment which melds the interrelationships explained in the previous section is developed. Since the early 1960s, researchers have proposed a number of approaches to the definition and measurement of underemployment ranging from "subemployment" indices (Miller, 1973;Wirtz, 1967;Vietorisz, Mier, and Giblin, 1975) to "employment and earnings inadequacy" indices (Levitan and Taggart, 1974). As in Salinas (1982), the concept of underemployment as defined in this study refers to the inability of labor-force participants to earn poverty-level wages and salaries (125 percent of poverty-level income) through their labor-market activity over the previous year.…”