Ivy Leaf - Fall 2001

Is There a Downside to Temporary Employement?


"I started butting heads with one of my graduate instructors over what exactly nonstandard employment was and so my research began by creating a taxonomy of employment relationships and their respective outcomes."

Over the last fifteen years or so, in light of layoffs and corporate downsizing, a growing number of businesses increasingly relied upon temporary employees to fill their employment needs at a lower cost. But how is this trend affecting the temporary employees themselves?

"Hiring non-standard labor workers, which includes temporary employees and on-call employees, is a benefit for the companies doing the hiring, but it's often not an optimal situation for the employee," says Barbara Wiens-Tuers, Assistant Professor of Economics at Penn State Altoona, who is conducting research on the outcomes of employment as non-standard workers.

Her research has found that temporary employees tend to be paid less than a permanent worker employed in a similar position, even after controlling for factors such as age, education, and length of employment. One reason this is a concern is because there tends to be disproportionate representation of women and minorities in the types of nonstandard jobs with the worst outcomes. This may be one factor behind the income inequality for minorities and women that persists into the present day.

Another concern stems from the US economy moving from expansion towards recession. "Many people move from welfare to temp work because it's often the easiest work to find and sometimes provides an entry point towards permanent employment. But, they will be the first to go when a company starts to cut workers. It may turn into a difficult situation for people who were looking to find what they hoped would eventually turn into permanent work."

She is currently doing research on the ability of nonstandard workers to build financial assets.

"Because of lower pay and more periods of unemployment, I'm looking at how their ability to build assets over time is being affected," Wiens-Tuers says. As a starting point to this research, she is looking at home ownership since a home tends to be the largest financial asset most households own.

"It's much more of a struggle for some nonstandard workers to buy and build equity in a home, for example, than an employee with a regular full-time job."

Wiens-Tuers notes that since the late 1980s and early 1990s, between five and 25 percent of employed persons have been classified as non-standard labor. This number has been subject to controversy, however, because researchers use different definitions of what comprises nonstandard employment.

She first became interested in non-standard labor practices in graduate school. "I started butting heads with one of my graduate instructors over what exactly nonstandard employment is. My research began by creating a taxonomy of employment relationships and their respective outcomes. In addition, I have always had a strong interest in the relationship of race and gender issues in employment relationships and employment outcomes."

In her research, Wiens-Tuers is looking at both the demand side and supply side of nonstandard employment. She hopes her research will answer the following questions:

  • What are the characteristics of firms that hire temporary workers?
  • What are the characteristics of workers that are in nonstandard employment arrangements, especially temporary work arrangements?
  • Are they there by choice or because of the lack of other alternatives?

We anxiously await her findings.