Surge in temp jobs reflects fundamental change in American workplace


Kathy Westra, principal of Your Green Voice Environmental Advocacy Communications, plays with her cat Buddy between working at her computer at her home in Silver Spring. In her previous job she was the director of advocacy communications for the Wilderness Society. (Nikki Kahn/THE WASHINGTON POST)
February 17, 2012

The nation’s unemployment rate is falling faster than expected, but what counts as a job has become increasingly murky.

More than a quarter of people who have found jobs since the recession ended have landed in temporary positions, according to government data, though private estimates range far higher. The numbers reflect a fundamental change in the way Americans work, with neither businesses nor their employees expecting to stay together for life.

That is raising new questions about the sustainability of the drop in the unemployment rate as workers cycle through jobs more quickly. It also leaves them more vulnerable to cycles of boom and bust — temporary workers are usually the first hired and first fired — and forces them to shoulder the responsibility of paying for health care and retirement.

“By definition, a good job was with a big company with big benefits where you could expect to work for your whole life,” said Carl Camden, chief executive of Kelly Services, one of the nation’s largest staffing firms. “The social benefits system relies on almost everybody working in a quote-unquote job. That’s not the case now.”

Though the shift has been gradually occurring for at least a generation, economists and academics say the Great Recession has hastened its arrival. Companies uncertain of the strength of the recovery have been reluctant to hire permanent employees, instead hedging their bets with short-term help. Meanwhile, workers are forging new careers as temps, contractors, consultants and freelancers in the face of a tight market for traditional jobs with 40-hour weeks and 401(k)s.

Consider the case of Kathy Westra, 57, of Silver Spring, who was laid off in 2009 from her job as head of communications for the Wilderness Society. For the next year, she devoted most of her time to hunting for a job. On the side, she took on a few short-term consulting projects to make ends meet.

But as more work came her way — and a “real job” never materialized — Westra stopped considering herself unemployed and started calling herself an environmental communications consultant.

“The competition was just so tight for every job that was out there,” Westra said. “After about a year, I realized, ‘Wait a minute — I’ve gotten through it and never fallen a day behind on my mortgage.’ ”

Officially, the government defines temporary workers as those hired by staffing agencies to fill short-term openings at other companies. They include secretaries and engineers and make up about 2 percent of the nation’s workforce. They are typically the first to be hired during an economic recovery, and their ranks have jumped 37 percent since the recession ended.

But there is a much larger number of Americans working as “free agents” who jump from project to project and might be employed by several companies at the same time. Little academic research has been done on these workers — the government does not track them — but private groups say their numbers have swelled since the recession.

A survey last year by Kelly Services found that 44 percent of workers considered themselves free agents, compared with 19 percent in 2006, before the recession hit.

Camden, the Kelly chief executive, said many of them are retirees who have “been there, done that, got the corporate T-shirt” but who want or need to continue working. Young, mobile workers are also drawn to temporary work as a way to build their skills without feeling tied to a company or even a city.

But the real drivers of the increase, Camden said, were the massive corporate layoffs that forced many Americans to find a new way to make money — whether they liked it or not.

Vera Pell, 58, has been laid off five times over the past decade. After the last time, the Oklahoma resident said, she simply gave up looking for another job.

“I finally decided that my life would be better if I had more control over it,” Pell said. “No more red tape and politics. No more giving away my skills so I could keep a job.”

Pell started a consulting firm, Evergreen Learning Designs, and began charging three times her former hourly wage. Her first contract was from a company that had laid her off.

She said her former employers think: “What about Vera? Can we get her to come back and do this?”

According to a survey by Staffing Industry Analysts, a research firm, businesses plan to increase the amount of temporary labor they use by 26 percent over the next two years. Jon Osborne, the group’s vice president of research, said the model is about 8 percent cheaper than hiring permanent employees, because most temporary workers do not receive benefits.

Camden said the cost of health care is the main deterrent for workers who would otherwise seek to join the contingent labor force. And it is a major reason that many workers hope temporary employment is just a pit stop on the way to something permanent.

A recent survey by staffing firm Adecco found that nearly two-thirds of Americans have a positive view of temporary work. But job security still ranked as the most important quality in a job, beating out even salary, the survey found.

The American Staffing Association, an industry group, said temporary workers are staying in their posts longer, averaging 13.8 weeks. Typically, about half of them end up in permanent jobs. Paul Osterman, a human resources and management professor at MIT, said that what happens when a temporary assignment ends is the ultimate indicator of whether this model of employment really works.

“Is this a good thing or a bad thing?” he asked. “It depends on what comes next.”

Ylan Q. Mui is a financial reporter at The Washington Post covering the Federal Reserve and the economy.
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