By  Fri Aug 9, 2013

The U.S. Job Market: A Temp Worker’s World

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According to recent data, 12 percent of the U.S.’s workforce is comprised of temporary workers.

The recent uptick in temp work has emerged as the biggest hiring trend in the economy, finding itself at the forefront of widespread media coverage. Large corporations such as Wal-Mart, General Motors, and PepsiCo have been thrust into the spotlight for relying on such hiring practices; however, these companies are just a few of the many that have been increasingly turning to temp workers, freelancers, consultants, and contract workers to fill their staffing needs.

Although hiring is usually a healthy indicator for the economy, the move towards hiring primarily temp and contract workers has come as an unsettling trend to many. Since the end of the recession four years ago, the number of temps has jumped more than 50 percent, to almost 2.7 million. According to government records, numbers like that haven’t been seen since 1990. In today’s job market, no other sector comes close to the rate at which the number of temps is climbing.

According to economists, the spike in temp work can be attributed to a desire by employers to match their payrolls to their profits, and enjoy the flexibility of adjusting their labor force to work on an as-needed basis. ”You have your just-in-time workforce. You only pay them when you need them,” says Susan Houseman, an economist at the Upjohn Institute of Employment Research.

Additionally, some employers are said to be using the tactic to sidestep forthcoming Affordable Care Act legislation that mandates that employers with a minimum of 50 full-time workers must provide medical coverage for them. The trend towards employing temp or consultant workers is reflective of the reality that many employers simply aren’t willing to hire for the long term.

For the unemployed, this news is unlikely to be seen as positive. Temp work is construed as undesirable to most because of the typically low pay, few benefits, and vulnerable job security. What’s more, temp jobs don’t tend to boost the economy the same way permanent jobs do.

While the temp trend has partly been born out of lingering uncertainty about the job economy, a survey of 37 economists conducted by The Associated Press in May found that 75 percent of those surveyed felt the increased use of temp and job workers is representative of a long-lasting trend. “There’s been a generational shift toward a less committed relationship between the firm and the worker,” says Ethan Harris, a global economists at Bank of America Merrill Lynch. (Continued on page 2)

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