Short workweeks during economic downturns, (EXCERPT), Monthly Labor Review Online, June 1983

Short workweeks
during economic downturns

Robert W. Bednarzik

Often overshadowed in the current recession by the rise in the jobless rate, the number of persons involuntarily working part time reached record levels in 1982. As the unemployment level passed 11 million persons, the number of "economic part-timer" neared the 7 million mark. Many of these persons had their workweeks reduced, with accompanying pay cuts, while others accepted part-time jobs only after unsuccessful searches for full-time work. Unlike the unemployed, those subject to a reduction in hours are not usually entitled to draw unemployment insurance benefits for their lost work time.¹

During an economic downturn, the number of involuntary part-timers typically rises before unemployment begins to increase, mainly because employers tend to reduce hours of work when possible before laying off employees to minimize the cost of turnover. In recovery periods, when new orders pick up and inventories are rebuilt, firms usually restore the hours of those on shortened workweeks before expanding their work forces. Thus, over the business cycle, changes in the number of persons involuntarily working part time are generally just a few steps ahead of changes in overall unemployment.

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Footnotes

1 The availability of pro rate unemployment insurance (UI) benefits for partial work time lost is discussed in Daniel Hamermesh, "Unemployment Insurance, Short-Time Compensation and the Workweek," Work Time and Employment, Special Report No. 28 (Washington, National Commission for Employment Policy, 1978), pp. 233-38. Of course, many of the unemployed do not collect UI benefits either. In 1982, the number of persons claiming such benefits averaged about 40 percent of the total number unemployed. A detailed discussion of UI data can be found in Saul J. Blaustein, "Insured Unemployment Data" in Data Collection, Processing and Presentation: National and Local (Washington, National Commission on Employment and Unemployment Statistics, Vol. II, 1979), pp. 198-258.

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