Surge in part-time jobs: a mixed reception. Businesses cut costs; workers gain convenience but lose on fringes
Lois Brown is a laid-off steelworker. She lives in the oldest part of McKeesport, Pa., a river and steel town a few knolls south of Pittsburgh. There, she supports her four children and a mortgage by straddling two part-time jobs, both in social work. On the phone, it all comes out in her voice. No permanent jobs to be found. Barely making it. And, she remembers, she needs new glasses. In the old days, of course, her US Steel benefits would have covered that, but as a part-timer, she receives no benefits.
Clear across the country, in a sunny suburb of Phoenix, Ariz., Margueritte Tram punches in as a part-time worker, too. Only she loves it. Her life is as different from her Pennsylvania peer as it is distant.
Mrs. Tram is working a reduced schedule because she wants to. She has some free time while her two children are at school, and she wants to learn something about banking and finance.
Western Savings & Loan pays a pretty decent hourly wage of $7.50. That's worth her time, Mrs. Tram says, and it's all right that she doesn't get benefits. She is covered by her husband's plan.
Mrs. Tram and Ms. Brown are riding an upswing in the number of part-time and temporary jobs that may leave businesses with a higher level of ``permanent'' part-time employees, according to labor experts.
The trend is likely to get a big push soon from the federal government, the country's largest employer (2.1 million employees, not counting postal workers).
Known for its nourishment of the career civil servant, the federal Office of Personnel Management (OPM) announced early this month that instead of discouraging temporary hiring, as it has in the past, it will rely more heavily on it for both skilled and unskilled work.
Cost savings and management flexibility, says OPM spokesman Patrick Korten. ``We're using temporaries as a means of planning for changes that may be down the road,'' like budget cuts, he says.
That sounds more like hard business talk, not governmentese. But it looks as if government is now imitating business, which after countless recessions has begun to realize that it pays to keep a trim, core work force and use nonpermanent help as a buffer against swings in the economy.
As sure as hot air rises, businesses inflate with temporary help soon after every recession. Personnel managers are often unsure of a recovery's strength or endurance, and so hesitate to add more weight to the full-time payroll. But the growth in nonpermanent jobs during this recovery seems stronger and is lasting longer than expected.
Audrey Freedman, a respected labor economist with the Conference Board in New York, believes many businesses now face such rapid change that part-time or temporary help could become almost a matter of course with them. The trend's blessings are mixed, she says:
It hurts people like Lois Brown who would rather hold down a full-time job. Most nonpermanent employees don't get health, pension, or vacation benefits. They are often excluded from training and a chance to move up in a company. They are mostly women and minorities. In certain industries, such as retail sale, they work for low wages. And when the economy gets nasty, they are the first to go.
``All that sounds bad,'' says Mrs. Freedman, ``but if companies are adding thousands and thousands of jobs [to the economy] because of that,'' then it's good. ``This recovery,'' she exclaims, ``created 7 million jobs.''
There's nothing like a batch of statistics to make a case, but for this one, there aren't many. The exact number of nonpermanent jobs ``can't be measured,'' says Freedman, since the jobs ``are hard to define.'' Companies look outside their ranks for workers by using temporary agencies, contracting for basic services such as cooking or janitorial work, hiring part-timers on their own, or contracting with individuals such as consultants or engineers.
The Bureau of Labor Statistics has this to report: The number of part-time jobs rose from 16.6 million in 1980, the early part of the recession, to 18.4 million in 1983, or from 15.5 percent of the work force to 16.5 percent. Most of that increase, says bureau statistician Thomas Clark, comes from people who have to work ``for economic reasons,'' basically because they need the money.
The bureau keeps track of one other set of nonpermanent work statistics: the number of people employed by temporary help services, such as Manpower or Kelly Services. Last October, these services had 668,000 on their payrolls -- 66 percent more people than the same month in 1982. ``Even though it is not a large group,'' says labor economist Harvey Hamel, ``for its size it has grown tremendously.'' It is still bounding upward, he says, which he finds surprising this far into a recovery.
There are many ``subreasons'' behind the long-lasting surge in nonpermanent help. But the main one is the basic condition of rapid change in business, economists say. Robert Zager, vice-president for policy studies at the Work in America Institute, calls it ``permanent change,'' and says ``the only satisfactory way to deal with change'' is to have a secure core work force dedicated to steering the company through storm and calm. A business can create job security, he adds, by using temporary help to pitch in.
``This time,'' says Mrs. Freedman, ``business is more serious'' about keeping the permanent work force whittled down. ``Competition is forcing business to do something about labor. . . . It's a matter of gaining a cheap work force -- of having to compete. The cost of benefits is one of the many things that need to be avoided.''
She points out certain sectors of the economy where this is happening: in financial services, which awakened under deregulation to the harsh reality of cost competitiveness; in high technology, which has to deal with global competition, cutthroat pricing, and new products; and now in government. (For now, heavily unionized industries don't seem to be hiring any more flexible staff than they usually do. It goes against the union purpose of guaranteeing the same benefits to workers who do the same jobs at the same company.)
In Phoenix, where Mrs. Tram lives, the banks are waging a quiet little war over what they call ``peak time'' workers. The banks have been influenced by an idea that blew down from Provident Bank in Cincinnati. The concept is to hire tellers -- and later on, other workers -- to handle peak traffic times. Provident pays its peak-time workers about $8.05 an hour for a 16-hour week. That's about $3 more than the industry norm for part-timers.
Willard Candland, vice-president for human resources at Western Savings & Loan, says the competition in Phoenix has just raised wages by 50 cents. Now he's considering a similar raise. The idea behind the higher wages is to attract better-quality part-time help, he says. The bank still doesn't have to pay benefits, yet it can draw intelligent, dedicated workers like Mrs. Tram, who are in an economic position where they don't care that much about benefits.
Mr. Candland is so enthusiastic about peak time ``because it enables you to cut your turnover of part-time employees by half. . . . It costs a little over $18,000 to lose a teller in the first year.'' While Candland figures he is saving quite a bit with peak-time, ``the real benefit is that we have better customer service.''
With deregulation and such intense competition, he says it's more important than ever for a bank to stress service. ``What turns a customer off is standing in a bank line for 20 minutes.'' Western Savings can correct that with its 200 peak-time tellers spread out over 72 branches. And, with better pay, employees feel more pride in working for the bank.
``The pay keeps me here,'' says Mrs. Tram, but she also likes the people. ``This branch is special. We're all close with each other. . . . I'd like to stay with this as long as I'm able to do it.''
Although banks are concerned with service (and cost cutting), the high-technology sector is more concerned about management flexibility.
In 1980, Control Data, the Minneapolis computer company, decided it could try to eliminate staff layoffs during down times by attempting to provide some job security for its core work force. It beefed up its temporary and contract ranks of clerks, assemblers, software engineers, and secretaries to fill in the gaps during high production periods.
``With changing technology and a changing marketplace, we needed a work force that could fluctuate,'' says Susan Busch, spokeswoman. Now 7,600 people, about 15 percent of Control Data's work force, are supplemental. Ms. Busch says the cost savings are not great, but the flexibility is essential.
Control Data is not unionized, but the federal government largely is. John Sturdivant, executive vice-president of the American Federation of Government Employees, the largest nonpostal union, is not pleased with the latest policy announcement from OPM.
``We have some questions about the government's proposed wholesale use of temporaries,'' Mr. Sturdivant says. ``I'm not starting out on the premise that temporaries are any less dedicated, but they do not have the institutional memory'' of the longstanding federal workers, he says. In food inspection, for instance, ``new people don't know who the chronic violators are.''
Beyond this, Sturdivant is concerned that the new policy might, in effect, hurt the union. ``It would be giving workers less pay, less benefits. It undermines the career merit system of benefits.'' The policy is just one more bit of heavy news for Sturdivant to digest. Federal budget cutters have been talking about 5 percent pay cuts for federal employees, as well as layoffs and more contracting out.
The OPM's Mr. Korten calls much of this criticism a red herring. The government has a history of experience with supplemental workers, he says. And on quality concerns, he adds that ``the same standards are imposed on job applicants regardless of whether they are temporary or permanent.''
Any organization determined to cut costs with temporary workers is bound to run into morale problems with its staff, Mrs. Freedman says. Temporaries may feel cut off and taken advantage of, while the permanents could feel threatened. ``To get strong company loyalty and job commitment . . . is going to be the trick of the century,'' she says.