U.S. Labor Gets Flexible...

Long-term jobs are waning

Two recent surveys underscore an ongoing debate about one of the most controversial U.S. labor market trends--the degree to which traditional work schemes offering regular long-term jobs are being replaced by more flexible, "contingent" arrangements under which workers are hired on a temporary or sporadic basis.

According to a detailed Conference Board canvass of some 93 major multinational companies, mostly U.S.-based, employment of contingent workers is already a well-entrenched policy. More than half of the respondents say they regularly employ on-call hourly part-time workers. And 84% to 90% use independent contractors and make regular use of temporary workers, either hired directly or supplied by agencies.

Further, such use is growing rapidly (chart). Within five years, no fewer than 35% of multinationals expect contingent workers to make up at least a tenth of their workforce--a trend fostered both by the need for labor force flexibility to meet demand fluctuations and by head-count restrictions imposed on managers in an era of continued downsizing.

Still, there's some question as to how widespread this trend really is. According to a household survey conducted by the Bureau of Labor Statistics in early 1995, only 6 million people, or about 4.9% of the workforce, are contingent workers. That's using the agency's widest definition, which counts all workers who expect their jobs to end within the next year or two.

The BLS also reports that about 10% of workers are now employed under what it terms "alternative arrangements"--including independent contractors and freelancers, on-call workers and day laborers, and workers for temporary-help agencies and contract firms. But it notes that not all such workers meet its definition of contingent.

Many experts feel the BLS definition is too narrow. For example, some would count the 4.4 million part-timers whose current jobs aren't in jeopardy but who would prefer full-time work.

What's indisputable is that workers themselves are far from happy about the growing trend toward contingent employment. Two-thirds of contingent workers interviewed by the BLS said they would rather have regular, permanent jobs. Those who didn't mind the arrangement were mainly students.

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