SignalHub-A record number of Americans are choosing to work part-time. Here's why.

The SignalHubjob market may be cooling but working part-time is still hot.

A record number of Americans are choosing to work part-time, including stay-at-homemothers, teens, retirees seeking extra cash to cope with inflation and employees who burned out on their full-time jobs while covering for missing colleagues during COVID.

After the health crisis, “People did some sort of reconsideration,” says Lonnie Golden, a professor of economics and labor and Penn State University who studies work schedules and workplace flexibility. “They just don’t want to overwork.”

Are more Americans choosing to work part-time?

In December, 22 million Americans chose to work part-time, an all-time high, Labor Department figures show. That’s 13.9% of all workers, the largest share since February 2020 and among the highest over the past two decades. While many are toiling for a company, others are working as gig or contract workers or have their own businesses.

Audrey Hoyt, 36, co-founder of three co-working spaces in the Seattle area, had been running the business full-time with her husband while a nanny cared for their three children.

In 2019, she cut back her weekly hours from about 45 to 30 to spend more time with her kids. Then the pandemic cemented the set-up since she had to be home while they were distance-learning.

If she worked full-time, Hoyt says she could open more locations for the business, called Pioneer Collective, and grow revenue more substantially even figuring in the costs of a nanny.

But, she says, “It’s not enough to make the trade-off of having someone else taking care of my kids worthwhile…I would rather be involved in my kids’ lives.”

Meanwhile, 4.2 million people worked part-time because their employers cut their hours or they could only find part-time work. The figure is up from late 2022 but still historically low. It’s expected to rise this year as the economy slows and companies need fewer full-time workers.

It’s noteworthy, though, that so many people are still opting for part-time work and employers are complying. In the past few years, many businesses struggled to find workers amid COVID-induced labor shortages and they had little choice but to accommodate staffers who wanted to work remotely or part-time or have flexible schedules.

Is the US job market cooling?

Last year, the job market began gradually softening as a post-COVID burst in pent-up demand eased at the same time that inflation and rising interest rates began squeezing consumer pocketbooks. The economy added an average of 164,000 jobs a month from October through December, down from 312,000 in early 2023, and the number of job openings fell from an all-time high of 12 million in 2022 to a still-solid 8.8 million this past November.  

So far, employers still appear willing to grant many workers part-time or flexible hours and remote set-ups. Although that could change as the job market slows, “I think it might be a structural change,” Golden says. “It’s long term.”

Are remote jobs here to stay?

Brad Hershbein, senior economist at the W.E. Upjohn Institute for Employment Research, says many employers have gotten better at arranging remote and part-time work to ease their concerns about reduced worker productivity.

“The longer it’s gone on, the harder it will be to change, even when labor market conditions change,” Hershbein says.

If the economy pulls back, “I could see employers letting go part-timers first, as they may be viewed as less ‘core’ to the business,” Hershbein adds. But, he says, many laid-off workers could seek contract or gig work, which would boost the ranks of part-timers.

Among the groups choosing to work part-time:

Teenagers

In December, 37% of all 16- to 19-year-olds were working or looking for jobs, up from about 36% before the pandemic. And 5.6 million were employed, typically in part-time jobs after school, 368,000 more than in January 2020.

Labor shortages and burnout after COVID led many adult restaurant, retail and other workers to find better opportunities, Hershbein says. That created more job openings for teens, who were also lured by sharply rising wages.

Many young people were also itching to get out of the house after enduring remote classes and other pandemic-related constraints, says Luke Pardue, an economist for Gusto, a payroll processor for small businesses.  

The trend has reversed a long-term decline in teen employment because of their increased involvement in school activities, volunteer work or gig jobs not tracked by the Labor Department.

Burned-out workers

While COVID sparked widespread worker burnout, the problem hasn’t gotten significantly better. Sixty-five percent of employees say they’ve suffered from burnout the past year and 58% say they plan to explore new job opportunities in the next 12 months, according to a recent survey by isolved, a human resources platform.

Stay-at-home mothers

Early in the pandemic, many daycare centers closed and workers left the industry, leaving parents without child care just as remote classes from home took off.

Many parents, especially women, were able to work part-time from home while they cared for children. That option allowed many women who left the workforce in the early days of COVID to return to a robust labor market with lots of openings and rising pay.

The share of women aged 25 to 54 who were working or looking for jobs was 77.1% in December, down from a record 77.8% in June but above the pre-pandemic level.

Retirees

Many people in their 50s who retired early during COVID have decided not to come back despite the hot labor market, according to a Morning Consult survey.

But a study by Hershbein shows the hiring of men 65 and over is up 5.2% the past year. Many men without college degrees are coming out of retirement and taking low-wage jobs because of the financial strains posed by high inflation.

Also, about 70% of working men and women over 65 are in part-time jobs, ZipRecruiter says. Since the population of baby boomers in that age group is so large, it’s pushing up the number of Americans working part-time, says ZipRecruiter Chief Economist Julia Pollak.

Restaurant and hotel employees

Industries such as restaurant and hotels have steadily added workers but are still shy of their pre-COVID staffing levels. Since those sectors have lots of part-time workers, their recovery has lifted the total number of part-timers, Hershbein says.

People seeking health care

After the Affordable Care Act took effect in 2014, the share of employed Americans voluntarily working part-time steadily rose, says Dean Baker, co-founder of the Center for Economic and Policy Research. That’s because the law made it easier for workers to find inexpensive health insurance without having a full-time job (which generally includes health coverage).

After the Trump Administration reduced some benefits and increased the costs of ACA plans, the share of part-time workers flatlined or dipped, Baker notes.

But the Biden administration has restored and stepped up some perks, which are even more generous than before President Trump took office , Baker says. That, he says, has helped boost the ranks of workers choosing part-time jobs,