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The Future of Contingent Work

April 1, 1995
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Related Topics: Contingent Staffing, Future Workplace, Featured Article
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Contingent work has continually evolved since its inception. The 1950s temp who filled in for emergencies and maternity leave has given way to the 1990s contingent who heads several projects and serves on work teams. And contingent work will continue to change in the future.

Temp work will become a training ground.
The recent spate of downsizings brought several things to light. First, there's no such thing as cradle-to-grave paternalism in companies anymore. Second, to be economically viable, employees must continually learn new skills. In this past economic down cycle, 86% of the unemployment was due to structural changes, according to the Department of Labor. "People's jobs just went away," says Bruce Steinberg, spokesman for the National Association of Temporary and Staffing Services. "They didn't suddenly become stupid; it's just that they ended up with obsolete jobs because they'd been working at the same company for years."

Many of these displaced employees found work at temporary jobs, where they honed old skills and learned new ones. In an NATSS survey of 2,189 temporary employees, 66% reported that they gained new skills during their tenure as a temporary. As the job market continues to tighten, and people continue to be phased out of jobs, it will be the temporary agencies that they turn to for help in developing the necessary job skills. "Thirty years ago if you were a typist, you could get a job, work at that job, and you'd have the same skills you had when you started. You wouldn't need new skills," says Steinberg. Not so anymore.

Terry Petra, a consultant to the staffing services industry and president of Professional Services Consultants, sees temp agencies in the future complementing school curriculums. "People need to learn how to adjust to environments much more quickly than they have traditionally," he says. "Part of that responsibility will flow from the educational institutions. But a subset of specialized educational opportunities will be made increasingly available, some through the staffing-services industry."

The number of professional-level contingents will continue to grow.
Professional-level temps are no longer an anomaly, and their ranks will continue to swell. "There's a movement away from people using these types of services for the lower level," says Olsten Staffing Services' senior vice president of marketing, Gordon Bingham. "You're seeing a lot of interest in professionals to be used on a project basis."

Temp services specializing in such areas as management, accounting-even physicians-are springing up all over. Many companies are taking advantage of this highly trained group of contingents. For instance, KLA Instruments keeps a cadre of contract recruiters on hand-professionals who remain contingent by choice. "They don't really want to be associated with any company," says DeMars. "They like coming in and saving the world and then heading off and doing it again somewhere else."

Robert Stover, CEO and founder of Western Temporary Services, gives an example of this temporary superhero: he knows a man who worked for several years as a temporary department store president for-hire. "The concept of what he was doing is the future. He'd work for one major store for a year or so, bring it back into a profitable situation, and then he'd leave."

Steinberg thinks the trend will continue to grow, partly as a result of battlescarred victims of downsizing not wanting to jump back into the fray. "Temporary help is a way of empowering yourself. In many ways those people may have greater job security because their employment does not hinge on the fortunes or misfortunes of a single boss, a single company or industry."

Temps are going to request-and receive-more benefits.
It's the old law of supply and demand. With companies snatching up more and more contingent workers, the number of good temps decreases. In a survey conducted by Snelling Personnel Services, 86% of responding recruiters report that it's more difficult than a year ago to find temporaries for assignments of any length. "There are some people who prefer being a 'permanent temporary,' but there are many temporary workers who've opted for full-time employment once the number of job openings grew," says Snelling Personnel Services President and CEO, Timothy J. Loncharich.

The situation gives temps extra clout. "We're going to have more demands placed on us," says Steinberg. "With the competitive nature of our industry, temporary-help companies are going to offer people more incentives to work for their company."

The most common of these incentives will be benefits. A report titled New Policies for the Part-time and Contingent Work Force by the Washington, D.C.-based Economic Policy Institute suggests several reform measures for the contingent work force, one of which is that employers should have to offer prorated health benefits to part-time workers. Right now, it's none too common: In the NATSS survey, only 8% of respondents received health-care coverage from their temporary agencies.

But most think these numbers will shoot up over the next few years, either as a result of government mandate or temporary agencies' heightened competition for the best workers. "I think it's inevitable," says Stover. "As temporary becomes a more stable part of American industry, I think all the benefit programs will gradually come."

MacTemps is one agency taking a big step in that direction, with the addition of a dependent-care reimbursement plan. The first temporary placement firm to do so, the program will provide a special account for its employees to assign a portion of their weekly paychecks before federal income or social security taxes are withheld, to be paid exclusively for dependent care. In addition, employees who work 300 hours in a 10-week period will be eligible for long-term health coverage, full disability insurance and complete dental coverage for preventive care. MacTemps pays 60% of the cost for long-term health care, and 100% of disability insurance and preventive dental care. "We are doing this because we feel that it's the right thing to do," says MacTemps' president John Chuang. "It's part of our program to attract and retain the very best people."

Personnel Journal, April 1995, Vol. 74, No. 4, p. 54.

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