Jul 01, 2014

Temps No Longer Temporary

Contract workers account for over 2.3 percent of U.S. employment, according to Bureau of Labor Statistics (BLS) reports. Research from online job site CareerBuilder.com shows that 42 percent of employers intend to hire temporary or contract workers as part of their 2014 staffing strategy.

Economic data also confirms that temporary workers are becoming a significant part of the American workforce. In March 2014, temporary work made up more than 2 percent of the workforce, a peak not seen since April 2000.

“We argued when the recovery began that there would be a structural shift. We were hearing from members who were hearing from their clients, [that] they were more likely to use temp and contract workers.” ~Steve Berchem, COO of American Staffing Association

Experts point to the Affordable Care Act (ACA) as a relevant factor in this trend, as employers strive to avoid benefit expenses. However, recent clarifications to ACA are aimed at closing this loophole.  Analysts predict that temp and contract employment will continue to increase as baby boomers retire from full-time jobs.

Some industries, such as manufacturing, are highly dependent on temporary workers. An estimate from the W.E. Upjohn Institute for Employment Research states that manufacturing companies employ 40 percent of all contract workers.

“I think on balance, they are a positive reflection of the extent to which production has become more flexible, a reflection of hybrid operations. Some people don’t like it. But that’s neither here nor there. That’s where everybody’s moving.” ~Jerry Jasinowsky, former Head of National Association of Manufacturers

Economists’ Concerns

Labor activists have concerns over the continued utilization of contract workers, citing risks such as lower paychecks compared to full-time workers and a lack of unionization. Economists worry that since temp workers are easier to release than full-time workers, companies will be able to avoid responsibility. Eileen Appelbaum from the Center for Economic Policy and Research says, “In the private sector there’s no counterbalancing power. The decision is almost costless to them.”

“Workers increasingly serve businesses that do not officially ‘employ’ the worker – a distinction that hampers organizing, erodes labor standards and dilutes accountability.” ~Catherine Ruckelshaus, General Counsel for the National Employment Law Project