Is The U.S. Turning Into A Nation Of Temps?

temp-workers-part-time-435df062013-1371760848

Source: AOL Jobs

Have you been wondering why it’s so hard to get a full-time position with benefits? Everyone knows it’s a bad economy out there, but if you’ve been struggling, new data may help you understand why.

According to the Bureau of Labor Statistics, the total number of temp workers surged by 7.5 percent in the last year, to a high of 2,679,800 last month, from 2,767,300 in October 2006. So while the economy has been slowly improving, with more employers hiring, the reality is that many of the new jobs offer only temporary employment without benefits.

Two sobering facts: The hiring rate of temp workers is five times the amount of overall hiring over the last year, as mediabistro.com points out. The number of temp workers has been rising steadily since 2009 (check out this chart put together by the employee recruitment news website ere.net).

Who is moving to a temp workforce? Pretty much everyone. Just last week, Walmart, the retail behemoth with some 1.3 million workers, confirmed that it’s hiring strategy has changed, stressing a temp workforce. Before the year began part-time workers only comprised one percent of the company workforce, but now the figure is around 10 percent. As Fortune noted, the uptick in temp hiring during the financial crisis has also been apparent at large employers from across the economy, like academic universities and internettechnology firms.

What are the reasons for the shift? Essentially, three different possibilities:

1. ObamaCare is to blame: Some, including the right-leaning Investor’s Business Daily,have suggested that the high number of temp workers is proof that employers are replacing full-time workers “to lighten the burden of ObamaCare’s regulations,” in reference to the President’s Affordable Care Act. (The law’s provisions have been taking effect since March, 2010.) According to the law, employers are only subject to fines from the health care law once they have more than 50 full-time workers, and so, as the argument goes, companies have an incentive to keep their head counts low.

2. A temp workforce makes employers more competitive: In speaking to Reuters, Walmart spokesman David Tovar said the change was not related to the new health-care law. Instead, it was described as a way to cut costs when consumers are spending less during tough times. Crucially, the model is also thought to give Walmart an edge over other big box stores like Costco, Sears and Target, who haven’t moved towards the temp-workforce.

3. The financial crisis emboldened employers: Labor market analysts told Reuters that it’s possible employers are simply taking advantage of a favorable environment in which so many Americans have been out of work for so long they don’t have the luxury to be picky about waiting around for good jobs with full benefits.

Erin Hatton, who’s the author of, “The Temp Economy,” said in an interview with AOL Jobs that employers could be given incentives to reduce the size of their temp workforce. As an example, she said that if the “burden of [providing] health insurance were lifted” from employers, it’s likely companies would not have to resort to such cost-cutting measures.

But such an idea remains controversial, as it would require the government to step in and offer health care. Regardless, Hatton, who’s also a professor of sociology at the State University of New York, Buffalo, says “if nothing is done — whether its because of workers themselves or people rallying on their behalf — to force employers to put restrictions on temp workers, this practice will definitely continue to grow.”

email