Tempting Fate

Ida L. Walters from the April 1994 issue

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Help-supply service workers (1.6 million, most of whom are employees of temporary-help firms) make up the smallest category. Though singled out as the most contingent and given the lion's share of media attention, temporary workers at large temp firms stay on the payroll for only about four weeks, on average. As noted above, due to high turnover, in a given year temporary-help firms employ five to seven times more workers than they send out on an average day. That means that in 1993 they provided short-term work assignments for 9 million to 11 million people, 80 percent of them wom-en. Clearly, for most of these, "temping" is not the permanent way of life it is made out to be. Temp workers hired by temporary-help firms that specialize (in engineers or accountants, for example) often have longer tenures. So do temporary employees hired directly by organizations, but there's no official count of these.

The four categories of contingent workers are shown in the chart. (Workers counted under engineering and management services are excluded due to lack of consistent data prior to 1988.) To portray these four categories of workers as a phenomenon that is either new, sinister, or fast-growing poses quite a challenge. "Temporary" has to be made synonymous with "contingent," and the workers profiled have to be cast as "living on the edge," which means ignoring the tens of millions of "contingents" who are planted securely on economic terra firma. Otherwise, the story falls apart.

Since the part of the contingent work force that's big isn't growing and the part that's growing isn't big, this means proponents of the myth must engage in a gutsy sleight of hand.

The challenge has been met. On April 27, the CBS Evening News, in its "Eye on America" segment, profiled a pregnant woman who worked at four temporary jobs. The account called her "one of 35 million so-called temps, temporary workers," adding, "By the end of this decade, fully half of the American work force will be temporary."

Labor Secretary Robert Reich appeared in the CBS account, lending it an "official" quality. Reich, along with Belous, is a permanent fixture of contingent-worker stories. Reich told Time that nobody's job is safe in the face of a fast-growing contingent work force. Belous chimed in with: "If there was a national fear index, it would be directly related to the growth of contingent workers."

Quotes from mainstream labor economists are conspicuously absent from these stories, with good reason. Top academic journals, unlike labor unions and their champions in the media, have yet to "discover" contingent workers. Likewise, highly respected policy and economic research institutions have yet to discover them. There are no references, for exam-ple, to contingent workers or a contingent work force (or to any phenomenon these names suggest) in two recent Brookings Institution books: A Future of Lousy Jobs: The Changing Structure of U.S. Wages, published in 1990, and Growth With Equity: Economic Policymaking for the Next Century, published in mid-1993.

Ironically, when the contingent work force concept was first trotted out in the late 1980s, it hit a wall erected by a slowing economy. As a percentage of total employment, temporary employment was basically constant during 1989-1991. The concept took hold when temporary employment jumped 12.5 percent in 1992 and another 16 percent in 1993. What's missed in the alarmism, though, is that temporary employment is highly sensitive to turns in the economy and always grows especially rapidly (34 percent in 1984, 25 percent in 1975) during the early period of recoveries. Contributing to the sharp speed-up in growth of temporary work over the last two years was the fact that, unlike previous postwar recessions, the recent downturn was structural rather than cyclical. This meant most layoffs were permanent; workers weren't going to be called back to their old job when things improved. Because of this, many sought temporary work to make ends meet while searching for another permanent job.

This option and others would be curtailed if proponents of the contingent-worker myth had their way. In his 1989 book, Belous says unions will renew efforts to reduce business's flexibility to "contract out" and its ability to hire temporary workers. When collective bargaining efforts fail, he adds, unions will fight in the courts and in Congress for rulings and legislation to reduce the cost advantage of hiring contingent workers.

Belous's scenario has supporters in high places. Secretary Reich has said that organized labor and the Clinton administration have the same agenda. Last June, the Senate Subcommittee on Labor held hearings bemoaning what one speaker, a high Labor Department official, called the "new and perplexing" growth in disposable workers. Richard Delaney of the AFL-CIO testified that a rapidly growing contingent work force "promises to fuel a continuing spiral of economic decline." Similar false and misleading claims, most of them recycled from media accounts, were recycled again in media coverage of the hearings. If the contingent-worker myth continues to circulate unchallenged, it may only be a matter of time before Congress, a deliberative body not particularly known for separating fact from fan-cy, may feel compelled to enact far-reaching job "protections" and "benefits" that will compromise the economy's ability to grow and adjust to change.

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