This paper explores the relative effects of individual, organizational, labor market, and societal components on underemployment of young adults during their early career.
Quantitative underemployment, defined as periods of unemployment, temporary employment, and part-time employment is of psychological importance, because it delays or hinders the integration of career starters into the world of work by excluding them from the experience needed to develop competencies and knowledge essential for functional participation in the labor force. A first step to decrease the occurrence of underemployment for career starters involves a better understanding of the relative importance of contributing factors. This paper used a longitudinal multi-country study to explore the relative weight of individual, organizational, and macro level factors on the occurrence of underemployment. From a sample of career starters in two occupational groups with relatively good employment prospects in six European countries, the results confirmed the relationships of underemployment to gender, education, initial experience, labor market outlook, and the socio-economic and socio-political situation of the country. The country specific variance in underemployment proved to be the most important predictor of youngsters later probability to be underemployed: its effect was about 2.5 times as large as the variance explained by the initial labor market experience and 10 times as large as the effect of the educational level.