In the current economic climate, many professionals have been forced to seek employment below their education or experience level. Although many companies are wary of hiring overqualified individuals, believing that they will underperform and/or leave when a better opportunity arises, a study published in Business Horizons suggests that hiring underemployed candidates can be valuable to the growth and success of a business.

“We aren’t suggesting that underemployment isn’t associated with any deleterious outcomes. We are simply proposing that underemployed individuals should not be mass categorized as a group of undesirables to be avoided,” the authors wrote in the study.

“Not all underemployed individuals constantly engage in job search behaviors seeking to find a better job,” Katina Thompson, lead author and a doctoral candidate in the Florida State University Department of Management, told O&P Business News. “Some underemployed people welcome this employment situation in an effort to gain increased flexibility, greater work/life balance and less job stress while continuing to perform well and to do meaningful work.”

Types of underemployment

According to the researchers, 18% to 25% of workers in the United States consider themselves underemployed. The authors define underemployment as the inability to obtain adequate employment relative to some standard and identify five categorizations that can affect how an individual perceives his or her employment status: education/knowledge, experience, wage, job status and job field.

“Attitudes and behaviors may vary depending on the nature and motivation of the underemployed condition,” the authors wrote.

When considering hiring an overqualified candidate, employers should know whether the underemployment is voluntary or involuntary, to anticipate how the candidate will behave in the workplace.

“This subtle distinction differentiates individuals who feel forced to accept a job they consider beneath them from 
individuals who accept a job of their own willful volition,” the authors wrote.

The authors also recommended evaluating the performance contribution gap, which they define as the perceived discrepancy between the employees’ actual performance contribution and their potential performance contribution. According to the study, the gap can “conceptualize the strain employees experience when their education, qualifications and such are not fully utilized on the job.”

This strain can potentially affect work attitudes and behaviors and create boredom or lack of interest after an extended period. To combat this, the researchers recommended offering job enrichment opportunities to ensure that employees feel utilized and appreciated.

“Whether that performance contribution gap is real or imagined, if employees feel that they can contribute more, organizations should try to accommodate them, recognizing that — in some instances — employees really are being underutilized,” the authors wrote.

The researchers suggest that assigning challenging tasks and offering leadership and training opportunities creates a more enriching and rewarding work environment for underemployed employees that could spur greater job performance and effort.

“We recommend that organizations offer job enrichment opportunities when possible,” the authors wrote. “Job enrichment opportunities should be designed to improve the meaningfulness of work, job autonomy and responsibility in an effort to decrease the performance contribution gap due to education, experience or job field underemployment.”

Business benefits

Although many employers may not want to risk hiring an overqualified employee, the researchers recognize several potential benefits that could enhance business performance.

“Organizations are primed to enjoy the benefits of hiring underemployed job candidates,” the authors wrote. “It allows organizations to better prepare for the next uptick and for future expansion opportunities.”

Underemployed candidates can bring new skills and expertise, product and market knowledge and/or access to larger business networks that could aid in future growth and development.

“Underemployed employees provide the organizational depth necessary to develop large leadership talent pools,” the authors wrote. “For many companies, the most opportune time to invest in such leadership development is during down markets, when top talent can be hired that might otherwise not normally be available.”

“Hiring managers should also note that the same economic conditions that may prompt organizations to downsize by offering early retirement packages or buyouts may also serve as a catalyst for employees, including high performing ones, who are seeking change,” Thompson added. “Identifying and hiring talented underemployed applicants who have desirable and transferrable skills should be a characteristic of progressive and forward-thinking organizations.”

These employees are also valuable resources within an organization, because the new business and market knowledge that they bring can be shared with existing employees.

“Underemployed employees represent an important training and mentoring resource for companies,” the authors wrote. “These employees can share their knowledge and experiences by helping other employees learn new skills, thus shortening the learning curve for newly-hired employees, and/or leading workplace process-improvement teams.”

Ultimately, hiring underemployed candidates requires employers to overcome existing notions about underemployed job candidates in order to capitalize on their potential.

“Identifying and redressing the jobs of the underemployed should result in lower turnover and higher organization-level performance, while simultaneously increasing employee job performance and satisfaction, and lowering job stress,” the authors wrote. — by Megan Gilbride

Disclosure: The authors have no relevant financial disclosures.