The Psychological Impact of Hours-Underemployment: Working Fewer Hours than Desired Predicts Psychological Distress in two British Samples

Presenter: Victoria Mousteri, Behavioural Science Centre, University of Stirling

Part-time employment has risen sharply in recent years, yet evidence of its potential mental health effects remains unclear. This paper uses propensity score matching and fixed-effects panel methods to assess the influence of working part-time while preferring to work more hours (hours-underemployment) on psychological distress. We draw on data from the UK National Child Development Study (NCDS; 1999-2000) and the British Household Panel Survey (BHPS; 1991-2008). In the NCDS sample (N = 4,558), the link between underemployment and General Health Questionnaire (GHQ) scores was examined at age 42, using propensity score matching to account for self-selection into hours-underemployment. In study 2, we used the population representative BHPS to test the potential impact of annual transitions between full-time employment and hours-underemployment on psychological distress assessed using the GHQ. Two subsamples were created to examine the effect of each type of transition, based on participants’ employment type in period t-1; from full-time to part-time employment (N=7,864) and vice versa (N=801). Fixed-effects models were used to adjust for time-invariant confounders. In study 1, being hours-underemployed predicted a 0.25 SD increase in psychological distress levels οn average. Study 2 showed that moving from a full-time job to unwillingly working part-time predicts elevated distress by 0.18 SD and conversely, switching from part-time to full-time employment produces a 0.16 SD reduction in distress. Earnings and perceptions of job security do not fully account for the psychological impact of underemployment. Together these findings point to the potential mental health consequences of the recent surge in hours-underemployment.