Temporary workers are starting to look, well, not so temporary.
Despite a surge this year in short-term hiring, many American businesses are still skittish about making those jobs permanent, raising concerns among workers and some labour experts that temporary employees will become a larger, more entrenched part of the work force.
This is bad news for the nation’s workers, who are already facing one of the bleakest labour markets in recent history. Temporary employees generally receive fewer benefits or none at all, and have virtually no job security. It is harder for them to save. And it is much more difficult for them to develop a career arc while hopping from boss to boss.
“We’re in a period where uncertainty seems to be going on forever,” said David Autor, an economist at the Massachusetts Institute of Technology. “So this period of temporary employment seems to be going on forever.”
This year, temporary workers have represented a significant part of hiring. In November, they accounted for 80 percent of the 50,000 jobs added by private sector employers, according to the Labor Department. Since the beginning of the year, employers have added a net 307,000 temporary workers, more than a quarter of the 1.17 million private sector jobs added in total.
To the more than 15 million people who are still out of work, those with temporary jobs are lucky. With concerns mounting that the long-term unemployed are becoming increasingly unemployable, those in temporary jobs are at least maintaining ties to the working world.
“With business confidence, particularly in the small business sector, extremely low,” said Ian Shepherdson, chief United States economist at the High Frequency Economics research firm, “it’s not surprising that permanent hiring is lagging behind.”
The landscape two or three years from now might look quite different, of course. Many economists and executives at temporary agencies say there are signs that more robust permanent hiring is coming in the new year. Business confidence is up, and temporary agencies report that the percentage of interim workers who have been offered full-time jobs is also up from last year.
Nevertheless, there are signs that this time around, the economy could be moving toward a higher reliance on temporary workers over the long term.
Several factors could be contributing to the trend. Many businesses now tend to organize around short- to medium-term projects that can be doled out to temporary or contract workers.
Donald Lane, chief executive of Makino, a manufacturer of machine burden. In some cases, companies wrongly classify regular employees as temporary or contract workers in order to save on benefit costs and taxes.
Certainly, Americans who have never held anything but a full-time job have sought out temporary posts because they were the only jobs available. And even before the recession, workers were learning that lifelong employment was disappearing along with phone booths and Filofax organizers.
But people still tend to prefer jobs with some sense of permanence, and with full health benefits and some form of retirement contribution.
Antonia Musto lost her job as a staff accountant for a newspaper in Wilkes Barre, Pa., more than two years ago. She signed on with oDesk, a company that matches contract workers with employers online.
She has since worked for several different businesses and even turned down a full-time offer last November. “I just think I’ve gotten very accustomed to working very fast and working with many different people,” said Musto, 38. She said she has fully replaced the income she was making at the newspaper and buys private health insurance.
Of course, businesses that can now hire talented workers for temporary jobs may find that when demand picks up, they will need to offer full-time positions with perks and benefits. But it could take a long time to reach that point.
That indefinite stretch worries workers who fear that future employers will look askance at a resume filled with short-term engagements. Others worry that they will lose valuable years of saving for the future.
Rodeo, the Sacramento accounting manager, said he made anywhere from 10 to 50 percent less while working in temporary jobs than he did at the produce company. He has also been without health insurance all year. None of the interim employers or temporary agencies have contributed to a 401(k) plan, nor has he been able to save much on his own.
He is confident he will eventually land a permanent post, but until then, he knows he is losing ground in planning for retirement. “Of course, for my generation, you can’t plan on Social Security,” he said. “Most likely, I will have to work longer.”