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Ackerman, Rebekah, A 2019. An Analysis of Labor Force Underutilitzation by Educational Attainment and Degree of Regional Rurality.

The unemployment rate dominates economic and political discussions concerning the state of the labor market; however, the measure overlooks individuals who are underutilized in their current form of employment or who, due to technical definitions, are not considered to be part of the labor force. This paper uses a multinomial logit to investigate how living in a more rural area affects the returns to educational attainment on employment opportunities, taking a more comprehensive view of underemployment by considering six employment outcomes: 1) full-time, 2) part-time for non-economic reasons, 3) part-time for economic reasons, 4) unemployed, 5) marginal attachment, and 6) not in the labor force. The results suggest that regional rurality and educational attainment have distinctly different effects on each of the six employment categories. Further, after controlling for educational attainment, employment outcomes in more rural areas have better employment prospects. As rural areas continue to face economic disparity and challenges in attracting high skill employers, this paper emphasizes the need for education reform in rural America.