Under-employment to drive the West's wages and policy

Subject

The impact of working less hours on policy.

Significance

Part-time work is increasing across the advanced economies, including those working part time but wanting full-time work. Initially this seemed to be a distinctly Japanese problem, but it is now being recognised as a more widespread source of stagnant wages, blue-collar despair and populist politics.

Impacts

• Weak demand since 2008 has allowed more firms to offer fewer hours to desperate job seekers, giving the under-employment trend momentum.
• Japan has changed its labour laws and broken down norms attached to the content of a job since the 1990s; other countries will follow.
• Convenience and lower wages drive firms to include under-employed workers in their workforce; only a tighter job market will end this.