HIGH TEMPS BURN
40M workers have no job security
Millions of Americans are back at work in fulltime jobs that are anything but permanent.
They’re toiling away without job security, often lacking benefits, in one of the labor market’s fastestgrowing categories of steady work. That’s the category for temps, contractors, freelancers and other socalled contingency workers known as “temptohire.”
“Jobs that are allegedly permanent are getting less permanent,” said Jon Osborne, vice president of strategic research at Staffing Industry Analysts. “The world of labor is radically changing — and it’s changing quickly. Unemployment has come down, but in ways that includes people quitting the labor force and not looking for work.”
And this new normal takes in almost 20 percent of US workers, who are as close as many will ever get to a meaningful fulltime job. That means multiple successions of stomachchurning hirings and firings on three to sixmonth job assignments. The overall number of these “independent” workers is more than 40 million, according to one assessment in the Harvard Business Review — counting temps, parttimers, contractors, contingent workers, the underemployed and others.
Why the new normal? With the US unemployment stuck at 6.3 percent, excluding doubledigit unemployment for young people, discouraged workers and underemployed, companies are in a buyer’s labor market. They are reluctant to beef up payroll with fulltime hires in an uncertain economy, according to OI Global PartnersGateway International, a humanresources consulting firm.
More employers, for example, are laying down the mandate — job candidates must work temporary assignments before they will be considered for fulltime jobs. And it’s not just for mailroom clerks. The jobs range from the back office to the executive of fices, in finance, accounting, IT, sales, legal and more, paying from the low$ 30,000s to the high sixfigures annually.
Some temp jobs pay above the average, but often that’s not the case. About 18 percent of today’s US labor market comprises contingent workers, notes Staffing Industry Analysts, which predicts that figure will climb to 22 percent by 2024.
Some 3 million people are now employed by temp service firms as temporary workers, about 3 percent of the total workforce — and an increase of almost 30 percent from 2010, according the American Staffing Association.
“The idea of longterm employment with companies is on the wane,” said Rick Spann, senior vice president of client services at OI Global PartnersGateway. “It’s a sign of the time — people are brought into companies not necessarily for the long term, but for shortterm jobs. Loyalty is not quite what is used to be on either the employee or company side.”
As companies emerge from the Great Recession, the US labor markets are in tatters. They’ve shed jobs and slashed costs in traditional sectors, such as financial services and construction.
The biggest job gains are often in lowerpaid sectors, such as healthcare and retail. Since 2008, according to the Labor Department, about 1.56 million healthcare jobs; another 959,000 in restaurant and food services, and 316,000 temp jobs were added.
Meanwhile, some of the biggest parttime job gains are happening on Wall Street.
It’s partly a result of the 2002 SarbanesOxley law for financial oversight. Wall Street HR firms were caught off guard because of a shortage of qualified staff. “Conservative banks that had, for security reasons, never hired a temporary worker before, had no choice but to turn to staffing agencies for help,” Osborne said. “Once they began employing temporary workers, the banks realized that those workers were actually no riskier or less loyal than internal staff, and it was mighty handy to be able to get extra help on demand.”
The 2008 financial crisis also forced many baby boomers to remain in the workforce longer than planned to recover steep losses. That dampened job prospects for college grads who are now often edged out by older and more experienced workers for parttime and temptohire positions, according to Spann.
“Frankly, we’re seeing a lot of companies saying their needs are temporary,” he said.
“If you can’t prove yourself to the company after three or six months, they’ll say thank you very much, and then you move on. About 50 percent of the time that happens. If it works out they hire you,” Spann added.