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No, America won't become a nation of part-timers

October 9, 2013: 10:47 AM ET

Some worry that the U.S. is destined to become a nation of part-timers, but a new report suggests that the growth in part-time work is only a temporary symptom of a slow economic recovery.

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FORTUNE – For many, the rise of part-time work in recent years represents an unsettling chapter in America's economic recovery.

Many of the jobs lost during the Great Recession were full-time gigs. And more than four years after its official end, we're nowhere near recovering all of those lost jobs. And yet, the ones we've gained have mostly been part-time, offering less pay and benefits than full-time work.

Some worry that the U.S. is destined to become a nation of part-timers, but a new report suggests that that's unlikely. True, the growth in part-time over full-time work has been drawn out, but that merely reflects a slow recovery, economists say.

The government defines part-timers as those who typically work fewer than 35 hours a week. When the recession began, 16.9% of those in the workforce were working part time. That share rose sharply in 2008 and 2009 and peaked at 19.7% in 2010. Today, part-timers account for 18% of the working population.

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Looking ahead, part-time jobs are likely to continue growing faster than full-time jobs, suggests a report by Indeed, a job search engine. Since January 2012, job postings grew an average of 2% per month. Postings for part-time jobs grew faster, at about an average of 3% per month, than full-time postings, which, on average, grew 1.5% a month

This isn't unusual. For more than a decade, part-time jobs have typically grown faster than full-time positions, says Tara Sinclair, economist at Indeed. The good news, Sinclair adds, is that the bulk of part-time jobs being posted are for positions where employees typically work fewer hours, such as customer service representatives, receptionists, administrative assistants, bank tellers, and retail sales associates. That suggests employers aren't converting full-time positions into part-time ones. More than that, the share of part-time jobs listed at Indeed is not nearly as high as the approximately 18% of workers working part-time today.

"The idea is that the current mix in the economy will change slowly, but in terms of new jobs postings, it looks like, if anything, a smaller proportion of new jobs are part-time than what we have in the overall job mix in the economy," Sinclair says.

And while the rise in part-timers may seem unusually pronounced, it's actually not by historical standards. In an August report by the Federal Reserve Bank of San Francisco, economists note the share of part-time workers relative to all workers peaked at 20.3% in 1983 -- slightly above the recent peak of 19.7% in 2010.

This time around, workers between 16 and 24 years old have been especially affected by the weaknesses in full-time job openings. So have those in their prime working years, ages 25 to 54, with only a high school degree or less. And the portion of people who take part-time jobs but really want full-time employment has remained stubbornly high. Researchers Rob Valletta and Leila Bengali at the San Francisco Fed argue that this sluggish progress reflects a slow economic recovery rather than a permanent change in the workforce.

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To be sure, the researchers add, health care reform could explain some of the rise in part-time jobs. The Affordable Care Act requires employers with 50 or more full-time workers to provide healthcare coverage or incur penalties, and some employers are trying to minimize the costs of expanded health benefits coverage. The trend will probably continue, though likely at a slower pace since the employer mandate was recently delayed to 2015.

The impact of health care reform on the composition of the workforce will likely be limited, though. Recent research suggests that the law would create, at most, a 1 to 2 percentage point increase in part-timers, similar to the experience in Hawaii, where the share of part-timers rose only slightly in the years following the implementation of the state's employer health care mandate.

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About This Author
Nin-Hai Tseng
Nin-Hai Tseng
Writer, Fortune

Nin-Hai Tseng covers economics and finance. Before joining Fortune, Tseng was a reporter at The Orlando Sentinel and a public affairs associate at GE. She holds an MPA from Columbia University and a BS in Journalism from the University of Florida. She lives in New York City.

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