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Working Paper
The evolution of the demand for temporary help supply employment in the United States
The level of temporary help supply (THS) employment surged during the late 1980s and the 1990s. However, we know little about where these workers were placed and, thus, there is a gap in our understanding of cyclical and trend industry employment in the U.S. To close this gap, we estimate the proportion of THS employees in each major U.S. industry during 1977-97 using information from input-output tables and from the Contingent Worker Supplements to the CPS surveys of February 1995 and February 1997. Our estimates indicate that almost all of the growth in THS employment is attributed to a ...
Journal Article
Temporary help services and the volatility of industry output
To gain a better understanding of how fluctuations in output influence firms' decision to hire temporary workers, the authors examine the relationship between output volatility and the use of temporary labor. They find that, all things being equal, temporary employment is higher in states with more volatile industries and lower in states with a relatively high degree of co-movement of industry output fluctuations.
Working Paper
What are the short-run effects of increasing labor market flexibility?
This paper evaluates the short-run effects of introducing labor market flexibility to an economy characterized by large firing taxes. Different reforms are considered: 1) eliminating all firing taxes, 2) introducing flexible new contracts while retaining the firing taxes on workers employed previous to the reform, and 3) introducing temporary contracts. The paper finds that eliminating all firing taxes increases the unemployment rate much more in the short run than in the long run, that introducing new flexible contracts has similar effects as eliminating all firing taxes, and that ...
Working Paper
Wage differentials for temporary services work: evidence from administrative data
We use administrative data from the unemployment insurance system State of Washington to study the magnitude of the wage differential associated with work in the temporary services industry. We find that temp wage rates are 15% to 20% below the levels that might have been expected based on trends during other periods in workers' careers even after controlling for differences between temps and other workers. Comparing temp wages immediately before and after temp work or to the wages on non-temp jobs begun during the same period as workers were in the temp industry yields estimates of the temp ...
Working Paper
The growth of temporary services work
Temporary services employment has expanded rapidly and now accounts for a sizable fraction of aggregate employment. The industry's workers are no longer overwhelmingly female or limited to clerical occupations. Temporary work is associated with variable weekly schedules and with part-year participation, but not with voluntarily part-time work. On average, temporary workers have less labor market security than permanent workers, being prone to both more unemployment and more underemployment. Relatively few of them, however, stay in temporary positions for as much as a year and the majority ...
Working Paper
Demand volatility and the lag between the growth of temporary and permanent employment
The growth rate of temporary help service employment is often considered to be a leading business cycle indicator, because the firing and hiring of temporary help workers typically lead that of permanent workers. However, few works in the literature focus on the mechanism that generates the lag between temporary and permanent growth. This paper investigates how demand volatility is related to the lag. Focusing on the relationship between a firm?s information extraction and their hiring/firing decisions, our simple model predicts that the average size of transitory demand shocks increase the ...
Working Paper
Temporary employment and the natural rate of unemployment
This paper examines the determinants of the natural rate of unemployment using a combined cross section and time series data set. The results suggest that industry composition affects the natural rate. In particular, a higher share of temporary employment in a local labor market tends to lower the natural rate of unemployment--most likely through the matching function. The results suggest that the increase in the share of temporary employment may have reduced the natural rate as much as 1/4 percentage point. The results also indicate that unemployment insurance benefits tend to boost the ...
Working Paper
Manufacturing plants’ use of temporary workers: an analysis using census micro data
Using plant-level data from the Plant Capacity Utilization (PCU) Survey, we examine how a manufacturing plant?s use of temporary workers is associated with the nature of its output fluctuations. Our empirical evidence suggests that plants choose temps over perms when they expect output to fall, which allows them to avoid costs associated with laying off permanent employees. We also found that plants whose output levels are associated with greater levels of uncertainty use more temps. The effects of other variables are also tested in order to examine the validity of various views about why ...
Journal Article
Spotlight: temporary employment
As the Texas economy expanded over the past two decades, firms increasingly relied on temporary workers to fill shortterm and seasonal staffing needs. In 1990, these employees accounted for less than 1.5 percent of Texas jobs. After peaking in 1999 and taking a recessionary dip, the number rebounded to 2.7 percent this year.