Temporary Jobs: Bah, humbug?

Michael Mandel

Temporary jobs are once again surging. In November they hit almost 2% of total employment, their highest level since early 2001.

But temporary jobs may not be good news for low-skilled workers, according to a new paper from the W.E.Upjohn Institute. David Autor and Susan Houseman (a friend of mine from grad school--hi, Sue!) write

We find that moving welfare participants into temporary help jobs boosts their short-term earnings. But these gains are offset by lower earnings, less frequent employment, and potentially higher welfare recidivism over the next one to two years. In contrast, placements in direct-hire jobs raise participants’ earnings substantially and reduce recidivism both one and two years following placement. We conclude that encouraging low-skilled workers to take temporary help agency jobs is no more effective - and possibly less effective - than providing no job placements at all.

Of course, welfare participants are not a random sample of all unskilled workers. But it does raise anew the long-time questions about whether temp work is creating a two-tier labor market.