Cyclical and Market Determinants of Involuntary Part-Time Employment

The fraction of the U.S. workforce identified as involuntary part-time workers rose to new highs during the U.S. Great Recession and came down only slowly in its aftermath. We assess the determinants of involuntary part-time work using an empirical framework that accounts for business cycle effects and persistent structural features of the labor market. We conduct regression analyses using state-level panel and individual data for the years 2003-2016. The results indicate that the persistent market-level factors, most notably shifting industry composition, can largely explain sustained elevation in the incidence of involuntary part-time work since the recession.