Analysing EU unemployment and underemployment in a fuzzy perspective: The comparison between fuzzy and official rates

The current computation of official employment and unemployment rates is based on the sharp distinction between employed and unemployed. In this study, employment and unemployment are not considered as attributes either present or absent, but it is assumed that everyone has some degree of both, ranging from 0 to 1. The number of hours worked and the individual's satisfaction with those hours are the key variables in determining the intensity of employment (and unemployment) for any individual in the labour force. Based on this assumption, we apply a fuzzy approach to derive fuzzy employment and unemployment rates. In particular, this study presents an application of the fuzzy approach to unemployment and compares official and fuzzy rates across a selection of European countries for the year 2023. Furthermore, the fuzzy results are discussed in relation to Eurostat's labour slack statistics on underemployment.