Temp work surges in area
Spike signals weak recovery from energy bust
After Katina Hightower and nearly her whole division were laid off in 2015 by the Norwegian oil company Statoil, she knew that jobs would be scarce in Houston as the energy bust intensified. So, she signed on with Burnett Specialists, a staffing agency that got her through another period of unemployment during the last national recession.
Over the past two years, she’s taken temporary work ranging from a onenight gig checking VIPs into box seats at the Super Bowl to filling in for six weeks as the chief operating officer of a large church. “You name it, I’ve probably done it working with Burnett,” said the 40-year-old Hightower.
And she’s not alone. Since the beginning of 2016, the number of people working in the employment services sector — which covers temp workers — has spiked by 23 percent, at a time when overall employment in Houston grew by less than 2 percent.
Temporary employment is surging in Houston even as it levels off in Texas and around the country, a sign that the region has yet to fully recover from the worst energy bust in a generation. Even as oil production resumed and manufacturing orders came in, local companies are still unsure of their long-term prospects and reluctant to hire people permanently as crude prices remain stubbornly low and the outlook for the industry uncertain.
“What it tells me is that Houston’s recovery is very weak,” says Patrick Jankowski, director of research at the Greater Hous-
ton Partnership.
At the same time, it also reflects a broader trend in U.S. labor markets as companies seek more flexible workforces and increasingly use contract employees as a way to more quickly ramp employment up or down as conditions change. This approach has quickly gained traction in the energy sector, with consultants — some former employees — brought on for shortterm projects as needed.
This just-in-time workforce strategy can be quite helpful for businesses. But for workers, the unpredictability of temporary employment can make managing the rest of their life difficult and pay less than permanent, full-time positions.
Although Hightower says that Burnett does a good job of keeping her busy, it’s less reliable, with jobs sometimes offered with only a few hours notice. She’s also gone from making more than $60,000 as an executive assistant at Statoil a year to sometimes $15 an hour, which amounts to half as much.
High tower is studying for her MBA in accounting and finance and expects to finish in December. But she’s already got a stack of other degrees and certificates, including one for paralegal work and another in criminal justice, that so far haven’ t ensured a steady job.
“It’s difficult to have all this education and background and still not be able to find full-time work,” she said. Outsource nation
In many ways, the recent history of corporate America is a story of businesses inserting more layers between themselves and the workers on whom they depend.
It began with outsourcing in the 1980s, as big corporations moved to shed all functions outside their fundamental businesses. Law firms, for example, are good at lawyering, not doing taxes or cleaning floors, the theory goes, so they hired accounting firms and janitorial services to do the work for which they used to employ people directly.
That’s true across the economy, from universities that let Sodexo or Aramark run their cafeterias to grocery stores that let another company run their distribution centers. Staffing companies, meanwhile, have expanded as companies seek to match their workforce to the peaks and valleys of their business.
Houston’s oil industry has long been part of this trend. Exploration and production companies like Exxon and Chevron rely heavily on providers like Halliburton and Schlumberger to drill and frack wells. The services companies, in turn, have their own subcontractors and sub-subcontractors.
And now, after laying off thousands through the oil downturn, many of those companies are bringing those people back on shortterm contracts.
A certain amount of that staffing surge is cyclical. Contractors are the first ones to go in a downturn, and the first ones to come back. But the oil recovery has been underway for more than a year now, and economists expected the recovery of contractors to have given way to more fulltime hiring by now.
That points to something else going on: Many of those laid off during the downturn were mature, experienced workers. Now that business has stabilized, companies need that experience for new projects but don’t necessarily want to take on the expense of health insurance and 401(k)s that come with putting workers on the payroll, staffing firms said.
Shane Slough, recruiting lead at the Houston-based energy and manufacturingfocused Houston staffing firm Whitaker Cos., says its candidate placements are up 22 percent from this time last year, and job orders for the third quarter are up 74 percent.
“There’s a bunch of engineers coming out of college, but not the ones with the five to 10 years experience that they need,” he said. “If they can hire some of these people on contract, to fill the void, it saves them money .”
Buy or rent?
In addition, staffing professionals said, companies in the energy industry are getting used to the idea that oil prices may stay relatively low for the long term, forcing them to be more careful about hiring decisions. Aleek Datta, an energy specialist at the consulting firm Accenture, counsels companies to think carefully about which workers they need to put on the payroll — suggesting that contracting could become an increasingly common feature of the industry going forward.
“Companies are going role by role and asking the question, should I build this capability inhouse, should I borrow it or rent it, should I buy it? Or could I automate it?” Datta says. “More contract services helps with that agility.”
And in Houston, it’s not just the energy industry: Hospitals have brought on hundreds of temporary workers to accomplish the Herculean task of transitioning to electronic medical records in recent years. Also, in a time of economic weakness, companies deluged with thousands of applicants for only a handful of positions often bring on staffing companies to sort through résumés. Often, they’ll offer people “temp-to-hire” positions that allow companies to make sure they’re a good fit.
Some workers appreciate the flexibility of temporary employment, while they go to school or take care of a sick relative. Many are happy to have any work at all, if full-time employment isn’t an option.
But still, even for highend professionals, finding enough assignments to pay the bills can be challenging.
In search of Plan B
That’s the case with Kathy Roldan, who worked as a geophysicist in Houston for more than two decades. She bought a house in Briar Forest, traveled the world running marathons, and built a comfortable nest egg. Then, in 2015, she was laid off from Murphy Oil.
She’s done a few projects on contract since then, which she found through word of mouth, and they’ve paid well enough. But they’re few and far between, and at 51, she would prefer to just have a fulltime job again.
“When I got laid off from Murphy, I didn’t say ‘Oh, I’m going to be a consultant,’ ” she says. “After all these years of working, it is extremely difficult to try to figureout what that plan Bis .”