Temp Work and Poverty: an Overview
Beth Bacher
SUNY Buffalo Law Student
March 6, 2014
What is temp work?
Temporary work, or temporary employment, describes a situation where an
employee is expected to leave their employer within a certain period of time. Depending
on the individual case, temporary workers may work full-time or part-time. In some
instances, temporary workers may receive benefits (such as health insurance), but
benefits are usually only given to permanent employees. Temporary employees can be
called the following: “temps,” contractual,” “seasonal,” “interim,” “casual staff,” and/or
“freelance.” Some temporary professional employees (in white-collar worker fields such
as law, engineering, and accounting) may even refer to themselves as “consultants.”
How do temp agencies function?
Temporary employees generally find their jobs through a temporary employment
agency (although a person can find temporary jobs in many other ways). A temporary
work agency (“temp agency” or “temporary staffing firm”) is responsible for finding and
retaining workers. When other companies are in need of short-term workers, they
contract with a temporary work agency to send temporary workers (“temps”) on
assignments to work at the other companies. Because temporary workers are generally
considered “on assignment,” they are generally used in work that has a cyclical nature
that consequently requires frequent adjustments to staffing levels.
Temporary employment agencies differ from employment agencies because
temporary agencies do not place employees with businesses that must put them on
company pay rolls; rather, temp agencies provide workers to a variety of businesses via
short-term contracts or indefinite temporary positions. Temporary agencies, then, serve as
the employer for most purposes (including paying the workers) and make their money by
charging the employers that contract the temp agencies. From the employers’ standpoint,
temp agencies perform many of the duties of a company’s human resources department,
but may be able to do so more efficiently and have access to a wider applicant pool.
Thus, temp agencies provide flexibility for both employers and employees; oftentimes,
temp agencies are viewed as cost-cutting measures that allow companies to use workers
without providing vacation time, health insurance or other benefits.1
How did temp work begin?
Temporary work first proved to be a lucrative method of employment after World
War II, when urban areas began employing housewives for part-time work as office
workers. Thus, temporary workers were typically white women in pink collar, clerical
positions; they provided companies with a stop-gap solution for permanent workers who
needed a leave of absence (due to the war, vacation, or illness). As time progressed,
however, companies noticed the benefit of having workers who could be hired and fired
on short notice and were also exempt from paperwork and regulatory requirements;
Grabianowski, Ed. “How Temp Agencies Work.” How Stuff Works. Accessed March 4, 2014.
<http://money.howstuffworks.com/business/getting-a-job/temp-agencies1.htm>.
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companies were also not responsible for paying for health insurance and other benefits of
temporary employees. As a result, there was a gradual but significant increase in the use
of temporary workers: over 3.5 million temporary workers were employed in the United
States by 2000.2
Since the turn of the millennium, temporary work agencies have become
increasingly competitive in their efforts to market flexible, adaptable temporary workers.
Thus, temporary agencies have proven to be extremely lucrative; as a result, many
temporary agencies have adopted practices that promote a “try before you buy” practice
that maximizes their ability to produce the employee most suitable to a company’s
demand.3 Through this highly competitive process, the ideal, modern temporary worker
has become imagined, produced, and marketed by temporary agencies.
What are the basics of temping?
A temporary work agency, then, may have a standard set of tests to judge the
competence of the clerical skills of an applicant; an applicant may consequently be hired
based on their scores on these tests and is also places in a database. Companies (or
individual business owners/contractors) looking to hire a temporary worker may then
contact the agency and describe the skill set they are seeking. A temporary employee is
then found within the database and is contacted to see if they would be interested in
taking the assignment.4 Temporary work agencies have increasingly made the recruiting
and promotion of their services more online-friendly in an age that heavily relies on
(social) media.
When a temporary employee agrees to an assignment, they receive instructions
specifically pertaining to the job. The agency is also usually responsible for providing
information on appropriate work attire, expected work hours/wages, and to whom the
temporary employee is expected to report. If a temporary employee arrives at a job
assignment and is asked to perform duties that were not described when they accepted the
job, they may call an agency representative for clarification.5 It is also important to note
that it is the responsibility of the temporary employee to keep in constant contact with the
agency when they are not currently working on an assignment; by notifying the agency
that they are available for work/temporary hire, they may be given priority over other
individuals in the database and are therefore more likely to be given an assignment.
How has temporary work evolved over time?
Temporary work has continued to evolve over time. In the decade between 2000
and 2010, an annual average of 13.1 million workers were dispatched to temporary jobs
by staffing agencies, and another 36 million individuals in the United States are
Hatton, Erin. “The Rise of the Permanent Temp Economy.” The New York Times. January 26, 2013.
Retrieved February 18, 2014. <http://opinionator.blogs.nytimes.com/2013/01/26/the-rise-of-the-permanenttemp-economy/?_php=true&_type=blogs&_php=true&_type=blogs&_r=1>.
3
Peck, Jamie A. and Nikolas Theodore. “Temped Out? Industry Rhetoric, Labor Regulation and Economic
Restructuring in the Temporary Staffing Business.” Economic and Industrial Democracy. Vol. 23, No. 2.
May 2002.
4
“What is an employment agency or temp agency?” Ontario Council of Agencies Serving Immigrants.
May 24, 2013. < http://settlement.org/sys/faqs_detail.asp?faq_id=4001076>.
5
“What is an employment agency or temp agency?” Ontario Council of Agencies Serving Immigrants.
May 24, 2013. < http://settlement.org/sys/faqs_detail.asp?faq_id=4001076>.
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employees on a daily basis in part-time jobs.6 It therefore appears as though the United
States has been replacing middle class jobs for decades with low-paying, temporary ones,
and the rate of this trend has increased since the 2008 recession as companies replace
their full-time employees with temporary workforces. As a result, survival for business in
this economic climate “translates into increasing productivity while decreasing the costs
associated with it, namely, labor.”7 It makes sense, therefore, that poverty would increase
with the growing unavailability and inevitable depletion of middle class jobs. Thus,
because businesses have been consistently shedding full-time workers and replacing them
with temporary workers they are able to “…avoid expenses associated with full-time
employment and payroll like health-coverage, workers compensation and human resource
expenses.”8 Clearly, such companies are reluctant to hire full-time employees in such an
unstable economy, so staffing agencies inevitably wind up supplementing their
workforces. In this vein, the companies can simply release the temps back to their
employment agencies if the economy happens to worsen. It is conditions like these that
have led the United States Bureau of Labor Statistics Employment Outlook 2010-2020 to
project that employment services will be one of the fastest growing industries over the
next decade.9
The trend toward a permatemp world has also been developing for years. Bosses
are no longer rewarded based on how many people they supervise, so they have less
incentive to hang on to their staff (and have less loyalty towards the employees they are
responsible for). Rather, the increasing use of bonuses tied to short-term profit
performance actually gives managers an incentive to slash labor costs. The Iowa Policy
Project, a nonpartisan think tank, reiterated this sentiment: the project estimated that 26
percent of the United States workforce had jobs in 2005 that were in one way or another
“nonstandard.” That includes: “independent contractors, temps, part-timers, and
freelancers. Of those, 73 percent had no access to a retirement plan from their employer
and 61 percent had no health insurance from their employer.”10
Some companies have also innovatively used temporary work as a means to end
strikes in the workforce. A strike occurs when employees, in a group, either walk off the
job or collectively determine that they will not show up to work as a way to protest
Berchem, S. “American Staffing 2011: Leading U.S. Job Growth, American Staffing Association.”
Accessed February 25, 2014. <http://www.americanstaffing.net
/statistics/pdf/American_Staffing_2011.pdf>.
7
Van Arsdale, Dave. “The Temporary Work Revolution: The Shift from Jobs that Solve Poverty to Jobs
that Make Poverty.” The Temporary Work Revolution. Page 11. Accessed February 25, 2014. <http://bflopoverty.wikispaces.com/file/view/vanarsdaleWUSA%5B1%5D.pdf/489583046/vanarsdaleWUSA%5B1%
5D.pdf>.
8
Van Arsdale, Dave. “The Temporary Work Revolution: The Shift from Jobs that Solve Poverty to Jobs
that Make Poverty.” The Temporary Work Revolution. Pages 15-16. Accessed February 25, 2014.
<http://bflopoverty.wikispaces.com/file/view/vanarsdaleWUSA%5B1%5D.pdf/489583046/vanarsdaleWUSA%5B1%
5D.pdf>.
9
Van Arsdale, Dave. “The Temporary Work Revolution: The Shift from Jobs that Solve Poverty to Jobs
that Make Poverty.” The Temporary Work Revolution. Page 18. Accessed February 25, 2014. <http://bflopoverty.wikispaces.com/file/view/vanarsdaleWUSA%5B1%5D.pdf/489583046/vanarsdaleWUSA%5B1%
5D.pdf>.
10
Peter Coy, Michelle Conlin and Moira Herbst. “The Rise of the Permanent Temporary Workforce.” NBC
News. January 10, 2010. Accessed February 25, 2014.
<http://www.nbcnews.com/id/34769831/ns/business-careers/#.Uw1EnXm27wI>.
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something that happened or is happening in their workplace. Many employers have
begun to hire replacement workers to keep the workplace producing product or services
during the strike. While the question of whether the replacement workers will become
permanent replacement workers or temporary workers that work only during the strike is
an issue that must be resolved by the National Labor Relations Board,11 such temporary
workers certainly function to end strikes. It is important to note that employers are not
obligated to continue paying employees who are on strike since those employees are no
longer working; thus, temporary workers help to end strikes because it makes the efforts
of the employees on strikes seem futile – the product of the company is still being
produced, and those on strike may quickly become unemployed.
Finally and in very recent times, temporary work has grown to encompass a
minority of temporary workers that have quite a bit of say in their work conditions (note
that most temporary workers have little to no say regarding the conditions in which they
work); such workers exist in specialized fields such as technology and medicine.
However, such temporary workers are more commonly referred to as subcontractors even
though they are commonly dispatched by the same firms as non-professional temporary
workers.12 Such workers have more bargaining power due to the low supply and high
demand of their services when compared to the average temporary workers. As a result,
professional temporary workers enjoy more negotiating power within the triangular
employment relationship that exists between the temporary agency, the contracting
company, and the temporary worker. They therefore have more power to demand
adequate wages and have more say in their work schedules.
How does temporary work relate to poverty in the United States?
Although temporary work may appear to offer many benefits to those living in
poverty in the United States, the evolution of temporary work appears not to offer a
viable solution to poverty and unemployment. Temporary work does offer some benefits
to those living in poverty in the United States. First, temporary work often allows
individuals to be hired for assignments fairly easily; in other words, those individuals that
meet the technical requirements for the type of work are oftentimes guaranteed a job
without a selection process. And, in some cases, agencies will hire temporary workers
without submission of a resume or an interview13 - which would eliminate the possibility
of discrimination due to a lack of education and/or criminal record. In addition,
temporary work offers the potential for flexible hours; this particular aspect could benefit
single mothers that have to work around the schedules of their children or any individual
attempting to juggle more than one job. Although not typical, temporary work may also
evolve into permanent employment. There are companies that do not hire internally and
use temporary employment agencies as their sole staffing service; as a result, such
“Union Strikes: Understanding the Nuts and Bolts.” Ohio State Bar Association. February 22, 2010.
Accessed February 26, 2014.
<https://www.ohiobar.org/ForPublic/Resources/LawYouCanUse/Pages/LawYouCanUse-608.aspx>.
12
Van Arsdale, Dave. “The Temporary Work Revolution: The Shift from Jobs that Solve Poverty to Jobs
that Make Poverty.” The Temporary Work Revolution. Page 16. Accessed February 25, 2014. <http://bflopoverty.wikispaces.com/file/view/vanarsdaleWUSA%5B1%5D.pdf/489583046/vanarsdaleWUSA%5B1%
5D.pdf>.
13
Manero, Conny. “The Pros and Cons of Temporary Work.” Yahoo! News. November 14, 2008.
Accessed. February 18, 2014. <http://voices.yahoo.com/the-pros-cons-temporary-work-2201139.html>.
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companies are a good gateway to gain permanent employment within a certain company.
Finally, temporary work, if nothing else, offers an opportunity for those living in poverty
in the United States to gain a wealth of experience: the average temp worker may be
exposed to countless situations and office procedures14 and inevitably increase their
chances for permanent employment in the long run.
Although the temporary help sector accounts for less than 3% of average daily
United States employment, it employs a disproportionate share of minority and lowskilled workers. And state administrative data show that between 15-40% of former
welfare recipients who obtained employment after the 1996 welfare reforms took jobs in
the temporary help sector.15 Temporary work agencies and business that utilize such
companies have also been relying heavily upon the easily-manipulated refugee and
immigrant population. While temporary work may inevitably prove beneficial and act as
a “stepping stone” to those individuals (who are oftentimes ignorant of the laws
relegating labor in the United States) living in poverty, it also must be noted that many
businesses take advantage of the tenuous financial situations that such individuals find
themselves in (the same is true of ex-offenders).
Does temporary work offer a solution to poverty?
Temporary work appears to be only a temporary solution to a widespread issue.
For this reason, many might consider temporary work less than ideal because there is a
lack of control over working hours. In addition, positions offered to temporary workers
typically have high turnover rates (this is because companies and businesses tend to
choose temporary workers over permanent ones when they expect output to fall, which
allows said companies to avoid costs associated with laying off permanent employees).16
Another disadvantage to temporary employment in the United States is that the gradual
replacement of workers by temporary workers has resulted in millions of workers being
employed in low-paid temporary jobs. Many individuals living in poverty are also
hesitant to become temporary workers because they fear that temporary work will prevent
them from continuing to receive governmental unemployment benefits. In other words, it
is unlikely that temporary employment allows such impoverished individuals to escape
poverty altogether. In fact, temporary workers earn roughly one-third of their permanent
counterparts; they also receive few or no health benefits.17 It is also important to note that
temporary workers are not paid for their on-call or wait time even though this practice
violates the Fair Labor Standards Act. Many temporary workers are taken advantage of
because the agencies that dispatch workers typically receive at least the same hourly rate
as the workers themselves, except in professional and skilled-labor staffing supply, where
workers in low supply and high demand have a bit more power given their desirable
Manero, Conny. “The Pros and Cons of Temporary Work.” Yahoo! News. November 14, 2008.
Accessed. February 18, 2014. <http://voices.yahoo.com/the-pros-cons-temporary-work-2201139.html>.
15
University of Wisconsin-Madison Institute for Research on Poverty. Focus. Volume 24, Number 3. 2006.
Page 1. Accessed February 18, 2014. <http://www.irp.wisc.edu/publications/focus/pdfs/foc243a.pdf>.
16
Ono, Yukako and Daniel Sullivan. “Manufacturing Plants’ Use of Temporary Workers: An Analysis
Using Census Micro Data.” Federal Reserve Bank of Chicago. Revised. February 2010. Accessed February
18, 2014. <http://www.chicagofed.org/digital_assets/publications/working_papers/2006/wp2006_24.pdf>.
17
Manero, Conny. “The Pros and Cons of Temporary Work.” Yahoo! News. November 14, 2008.
Accessed. February 18, 2014. <http://voices.yahoo.com/the-pros-cons-temporary-work-2201139.html>.
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specializations.18 Temporary agencies also demand a lot of their temporary employees.
As Judy Cicatiello explains: “Once you accept an assignment with a temp agency, you
are obligated to check with them for additional work upon completing each assignment
before reactivating your Unemployment Insurance claim. By law, failure to contact them
for additional assignments is considered ‘quitting’ and can be disqualifying.”19 Thus, it is
unclear as to whether an individual living off of unemployment insurance may actually
financially benefit from gaining temporary employment, and temporary employment does
not seem to be the most efficient way to end poverty in the United States.
Van Arsdale, Dave. “The Temporary Work Revolution: The Shift from Jobs that Solve Poverty to Jobs
that Make Poverty.” The Temporary Work Revolution. Page 3. Accessed February 25, 2014. <http://bflopoverty.wikispaces.com/file/view/vanarsdaleWUSA%5B1%5D.pdf/489583046/vanarsdaleWUSA%5B1%
5D.pdf>.
19
Varelas, Elaine. “Losing Unemployment Insurance Benefits by Finding Temp Work?” Job Doc. May 12,
2010. Accessed. February 18, 2014.
<http://www.boston.com/jobs/news/jobdoc/2010/05/losing_umeployment_insurance_b.html>.
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