TEMPS TAKE ON A FULL-TIME ROLE IN INDUSTRY
By NANCY CLEELAND, Times Staff Writer
Think temp worker for the new economy and what do you see? Computer whizzes who choose flexibility over the boring 9-to-5 and get paid nicely for it?
Think again--of hats, callused hands, grease under the fingernails. Think assembly lines. Forklifts. Machines that actually make things.
The big growth in temporary staffing--which has outpaced overall employment growth for more than a decade--is not found in offices or on the Internet, but in factories and warehouses. Places where people like Ricardo Ramirez work.
Ramirez, 38, a veteran warehouse stocker, assembler and forklift operator from Montebello, recently took the plunge into the temp world--only because he had no choice.
"Looking for a job now is nothing more than putting in applications at agencies," said Ramirez, who lost his warehouse job a month ago and immediately began scouring newspaper want ads.
Nearly every listing that caught his eye--from welding to construction cleanup--was offered by temporary agencies. Even when Ramirez went directly to a factory in need of a machine operator, he was advised to apply through an agency. "They told me they want to see how I work," he said. "If they like me, they'll hire me."
In manufacturing plants across the nation, temping has become a de facto audition for a real job. But that's just one reason for its phenomenal rate of growth.
By keeping a portion of their work force temporary, industrial employers can trim production costs, expanding or shrinking payroll according to the demand of the moment.
And a worker who doesn't live up to increasingly high expectations can quickly be replaced at little risk to the employer. "Because productivity is up, they want someone who's going to produce right away," said Patty Murphy, spokeswoman for temp giant Manpower Inc.
For that flexibility, employers are willing to pay a premium--usually in the form of an ongoing commission. A 1995 survey found that companies on average paid agencies 40% above workers' wages. The extra covered Social Security and workers' compensation payments, overhead and marketing, as well as profit.
Once a small fraction of the temporary work force, blue-collar workers have come to dominate growth in the industry and will soon eclipse clerks and other pink-collar temps in numbers.
They range from day laborers who sign in at 5:30 a.m. at cash-paying agencies such as Labor Locaters in Anaheim to long-term "perma-temps" who pack ice cream cartons at the Dreyer's manufacturing plant in Commerce.
One indication of the growth: Labor Ready, a Tacoma, Wash.-based employment chain specializing in manual labor, opened its first office just 10 years ago and already has more than 650 sites.
Temporary workers fill nearly one of every 20 manufacturing jobs, according to an analysis by the Federal Reserve Bank of Chicago. And Labor Department projections show a continued explosion of blue-collar temp jobs into the next millennium, while white-collar assignments stagnate or shrink.
"It's everywhere," said Eric Zepeda, office manager for employment agency Volt Services in Downey. "Go to just about any company out here and you'll find they hire some kind of temporary employee."
In this jittery new world, a layoff is simply an "end of assignment," job security is unknown, and most of the risk of fluctuating markets is transferred from employer to employee.
"By shifting that risk, they can make their profits much more stable," said Alec Levenson, a labor market analyst with the Milken Institute in Santa Monica. "But it can also make life a lot harder for the employee."
Indeed, temporary workers may be good for the economy--boosting productivity and possibly helping to curb inflation in a tight labor market--but they suffer for it. And blue-collar temps suffer disproportionately by virtually every measure.
They earn less--by nearly one-fourth--than permanent workers doing similar jobs. They are far less likely to have health insurance, a pension plan or other benefits. And although about half eventually end up with permanent jobs, more blue-collar temps are unemployed a year later than any other group.
In high demand now, temps are also particularly vulnerable to an economic downturn. As Ramirez put it, "We are becoming disposable people."
It's no wonder then that a recent Labor Department survey found that two-thirds of temporary workers would rather have permanent jobs but could not find them.
Unions, which have noted the growth of temporary services in manufacturing with dismay because such workers are extremely difficult to organize, are looking for ways to tap into that discontentment.
"We're trying to get a good handle on it, to figure out the best strategies," said Chris Owens, assistant director of public policy for the AFL-CIO. "But because many temp workers move from one job to another, it is harder to locate them."
The triangular relationship between employer, agency and worker also complicates organizing efforts and raises questions of responsibility that are only beginning to be sorted out by the courts.
A federal appeals court ruling two weeks ago in a case against Microsoft was seen by labor advocates as an important step. The court upheld the notion that long-term temps supplied by an agency were in fact "common law employees" of Microsoft and thus were entitled to stock options given to permanent employees.
"This provides more fodder for workers and reaffirms what the laws already say, that labels don't matter," said Catherine Ruckelshaus, litigation director of the National Employment Law Center in New York.
In one innovative approach to organizing temps, a coalition of unions and community groups in San Jose has created its own employment agency, called Solutions Network.
Initially geared toward clerical workers only but with the goal of eventually including blue-collar workers as well, Solutions Network has set a minimum wage of $10 an hour and provides a full package of benefits.
The coalition is also forming a temp worker membership group and has proposed a code of conduct for temporary agencies.
"Here in Silicon Valley, 40% of the work force is contingent [including temps, contract workers and the self-employed] versus 25% nationally," said Robert Dhondrup, spokesman for the coalition, Working Partnerships.
"We're leading the country, but it's happening everywhere. Labor is becoming a vertical structure, with a permanent core surrounded by contingent workers who are employed only when there is work available."
Whether that arrangement amounts to exploitation or is merely an efficient use of labor in a competitive global economy may depend on one's point of view.
Temp agencies insist that they provide a valuable service to workers by matching them to appropriate jobs. "Through an agency, you have a lot more contacts," said Jason Dufault, office manager for Western Labor Leasing in Long Beach. "You're able to find a job that suits you and work while you look for that job."
With competition for workers growing fierce, more and more agencies offer health benefits to their steady workers--even if only the opportunity to buy into a group insurance plan--and paid vacations. Some provide basic job training and coach workers in how to make a good impression.
"We want employees to exceed expectations," said Murphy of Manpower, noting that 40% of agency placements lead to permanent jobs.
Some economists hold that temporary agencies are symptomatic of a fast-changing economy that has not been kind to workers, and that the agencies are not in themselves a cause of worker woes.
"High pay for manual labor is gone, and that's a real problem for people who don't have a foundation of fundamental skills," Levenson of the Milken Institute said. "The dilemma for those workers is not caused by the growth of temporary staffing. Their dilemma is caused by the larger changes going on in the labor market."
A well-developed temporary staffing industry could actually help blue-collar workers find greater stability, wrote Lewis M. Segal and Daniel G. Sullivan, economists with the Federal Reserve Bank of Chicago who have studied temporary staffing trends.
"After all, working in the temporary services industry may be better than the alternative of working in the rather chaotic market in which firms hire their own temporary workers directly," they wrote.
And because about 57% of all blue-collar temps find permanent jobs within a year, Segal and Sullivan wrote, it is unlikely that the growing use of temporary agencies will lead to a permanent underclass.
Ricardo Ramirez, for one, hopes his foray into temp work is brief. "You have to be careful," he said after a discouraging day of visiting agencies, "because there are good companies and bad companies. The bad companies only think about money, about getting you cheap. They might keep you that way for months, for years."
Three days later, the father of two had turned down several offers. In one case, he spent four hours on the job--unpacking clothing imported from Asia--before deciding there was no future in it. "I went back to the agency and told them not to send me to jobs like that," he said. "I want permanent work."
Now Ramirez runs a die-casting machine, turning out aluminum parts on the night shift in an Irwindale industrial park.
He works hard, skips breaks and doesn't stop for idle chatter. He is there to make an impression. And maybe in a week or two, if he doesn't make a single mistake, Ramirez will win the prize of a permanent job. More money. Health and dental insurance. A 401(k) plan. And best of all, security.
"These days, you have to prove what you're worth," Ramirez said with a studied nonchalance that almost masked his nervousness. "The companies have the luxury of putting people to work or taking the work away. That's just the way it is."
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Changing Work Force
Once a small fraction of the temporary work force, blue-collar workers have come to dominate growth in the industry and will soon eclipse clerks and other pink-collar temps in numbers.
Number of Temporary Workers
Average daily employment in temporary help services, in millions:
'90: 1.17
'91: 1.15
'92: 1.35
'93: 1.64
'94: 1.97
'95: 2.16
'96: 2.31
'97: 2.54
'98:
First Quarter: 2.59
Second Quarter: 2.74
Third Quarter: 2.87
Fourth Quarter: 2.94
Breakdown by Sector
Share of temporary help payroll, by industry segment:
Clerical: 40.5%
Industrial: 34.5
Technical: 10.9
Professional: 6.4
Health care: 2.2
Marketing: 0.7
Other: 4.8
Source: National Assn. of Temporary and Staffing Services