Tag Archives: Princeton University

The New American Workforce

It appears that in the wake of ongoing—and lengthy—unemployment, the U.S. is creating a new class of worker—the “Permanent Temporary Worker.” Of course there has always been this classification of worker, but it now appears to be going mainstream and currently accounts for 26% of all U.S. workers.

With the U.S. economy in disarray, and government legislation in process that will heavily impact employers, companies simply are not hiring full-time employees. There is such a wealth of talent available on an “as-needed” basis there is no real reason why companies should hire full-time employees. A company can enjoy the flexibility of using temporary employees—without all the hassle and expense of benefits.

But, what about the employees? How is this current trend going to affect them? Well, here is a part of the reality:

  • No paid health insurance
  • No sick days
  • No paid vacation
  • No company-funded retirement plan
  • Usually no premium for overtime pay
  • Without any job security, benefits, or social ties to the rest of the workforce, stress levels are increased and depression sets in, which results in permanent temps being twice as likely to report symptoms related to mental illness than their counterparts who are permanent employees.

With 26% of today’s U.S workforce falling into the permanent temp category, what does the future hold—for either the employer, or employee? When the new healthcare reform becomes law, and every person is required to buy health insurance, that will reduce the permanent temps disposable income. When small business owners are required to provide health insurance for their employees, they will likely reduce their workforce in favor of permanent temps, thus increasing the role of permanent temps even further.

A recent Princeton University study predicted that 22% to 29% of all U.S. jobs would be offshored within two decades. It may not take that long—IBM had 71% of its workforce outside the U.S. at the end of 2008, and in 2009 reduced it’s U.S. workforce by 10,000 (8%). It seems so many companies are offshoring today that any “permanent” jobs left in the U.S. may only be in the service sectors—auto, food, health, and yards.

If the U.S. should ever get to this point, the permanent temporary worker may really have the best deal of all, and that would be a very sad situation.