An increase in the number of underemployed workers leads to an increase in the unemployment rate.

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Underemployment refers to workers who are employed but not in their desired capacity, either in terms of hours (part-time vs. full-time) or their skill level (working in a job that doesn't utilize their skills or education). The unemployment rate, however, measures the percentage of the labor force that is jobless and actively seeking employment. Therefore, an increase in underemployment does not directly affect the unemployment rate, as underemployed workers are still considered employed.

An Increase in the Number of Underemployed Workers Leads to an Increase