Some nine million people wishing to work (more)

^{Destatis, 29 June 2010}

A total of 8.6 million people in Germany would like to work more than they currently do. For those concerned, the unfulfilled wish for (more) work involves, sometimes strong, impairments in the quality of life. For the national economy, it means unused labour supply.

The number of people with an unfulfilled wish for work is composed of various groups of persons. The discussion about unused labour capacities refers not only to the unemployed but also to underemployed persons in employment and to persons in the hidden (or potential) labour force.

Unused labour supply:
Unemployed, underemployed and hidden labour force

Larger view of the diagram Unused labour supply

Unuses labour supply

In 2009, a total of 63.6 million persons aged between 15 and 74 years lived in Germany. They included 38.7 million persons in employment, 3.2 million unemployed and 21.7 million inactives. The unemployment rate of those aged 15 to 74 years, when measured as the share of unemployed in the labour force, was 7.7%.

The unemployment rate alone, however, does not completely represent the potential labour supply. First, the persons in employment include those who are underemployed, who wish to work more and would be available accordingly. This refers, for example, to part-time workers who would like to increase their working hours, or full-time employees who would be willing to work more in order to earn more money. Altogether there were some 4.2 million underemployed in 2009.

Second, there are people who are part of the hidden labour force (1.2 million). This includes persons who are neither in employment nor unemployed but who, nevertheless, are very close to the labour market. Those are, for example, people not looking for a job because they do not think they have a chance to get one. Actually, however, they would like to work and would be available for a job. Also, there are persons who are looking for work but currently are ill so that they are not available in the short term.

All three groups of people together (unemployed, underemployed and hidden labour force) are an unused labour supply of 20.1% when put in relation to the total of the labour force and the hidden labour force at the age of 15 to 74 years.

Underemployment: Persons in employment wishing to work more

Underemployment rates

More than every tenth person in employment (10.9%) aged 15 to 74 years in Germany indicated to be underemployed in 2009.

As regards the underemployment rates, there are marked differences between eastern and western Germany. In the West, the share (10.1%) was slightly below the federal average, while in the East it was considerably above (13.9%). Between sexes, too, there are differences: Among women (12.1%) the wish for more work is more obvious than among men (9.8%).

Wishing to work more hours involves the prospect of earning an additional income. Consequently, the interest in more working hours is not at all limited to part-time workers. Altogether, they indicate more often (22.2%) to be underemployed than full-time employees. Among full-time workers, the share is still 6.8%.

Among all persons in employment who indicated to be underemployed in 2009, only slightly more than half (53.3%) had a part-time job. The others were in full-time employment (46.7%). Especially a large part of the men wished to work more hours per week although they had a full-time job (69.9%).

Hidden labour force: Inactives wishing to work

Shares of hidden labour force in the inactive population

Among the inactive population aged 15 to 74 years, 5.7% belonged to the hidden labour force in 2009. This includes persons who, although they would like to work, either are not available to the labour market in the short term or have not actively looked for a job in the last four weeks.

Reasons for not actively seeking a job or not being available may be personal or family obligations (including childcare) just as sickness or advanced training. For persons not actively looking for work, discouragement plays a role, too. Just under every sixth person not actively seeking a job has given up because of a lack of prospects of success and another 17% indicate personal or family obligations as a reason.

People in the hidden labour force, too, are found more frequently in eastern Germany than in the western part: Their share in the inactive population was 6.8% in the new Länder including Berlin. In the former territory of the Federal Republic, the share was just 5.4%. There are just slight differences between the sexes.

Germany compared with the European Union

EU-27: Unemployment rates

.In a European comparison, too, the additional indicators of underemployment and hidden labour force complete the picture of the labour market and can be grouped with the unemployed to form an unused labour supply. When examining only the unemployment rates – as is frequently done in international comparisons –, Germany ranked 12th with 7.7%. The lowest EU value was recorded for the Netherlands (3.4%), the highest for Spain (18.0%).

However, when comparing the rates of unused labour supply between EU countries, Germany (20.1%) ranks only 20th. Within the EU, there was a range from 8.1% in the Netherlands to 39.5% in Latvia.

Author:
Dr. Martina Rengers – Federal Statistical Office

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