FW: FW: Clintonoids Serve Up Mud Pie Analysis

Doug Henwood dhenwood at panix.com
Wed May 17 15:17:37 PDT 2000


Max Sawicky wrote:


>DH:
>No doubt at least some of the growth in temp help - which appears in
>the employment numbers as temp help, a service industry - has been
>among people actually working in factories. Anyone from EPI got a
>handle on this?
>
>probably. Maybe I can dig something up, though it
>should be on our web site somewhere.

Ah. Here's a clue:

<http://www.bog.frb.fed.us/pubs/feds/1999/199957/199957abs.html>.


>Measuring Temporary Labor Outsourcing in U.S. Manufacturing
>Marcello Estevao and Saul Lach
>1999-57
>
>Abstract: Several analysts claim that firms have been using more
>flexible work arrangements in order to contain the costly adjustment
>of labor to changes in economic conditions. In particular, temporary
>help supply (THS) employment has increased dramatically in the last
>ten years. However, there is only scant evidence on the industries
>that are hiring this type of worker. In particular, some anecdotal
>evidence points to the fact that manufacturing industries have
>substantially stepped up their demand for THS workers since the
>mid-1980s. If this is true, not accounting for this flow of workers
>from the service sector to manufacturing may lead to misleading
>conclusions about the cyclical and long-term path of manufacturing
>employment and hours of work. We close this gap by providing several
>estimates of the number of individuals employed by temporary help
>supply (THS) firms who worked in the manufacturing sector from 1972
>to 1997. One estimate, in particular, is based on a new methodology
>that uses minimal assumptions to put bounds on the probability that
>a manufacturing worker is employed by a THS firm. The bounds rely on
>readily available data on workers' individual characteristics
>observable in the CPS. We show that manufacturers have been using
>THS workers more intensively in the 1990s. In addition, the apparent
>flatness of manufacturing employment in the 1990s can be explained
>in part by this type of outsourcing from the service sector.
>Finally, not accounting for THS hours overstated the increase in
>average annual manufacturing labor productivity by 1/2 percentage
>point during the 1991-1997 period.
>
>Keywords: Outsourcing, contingent workers, adjustment margin,
>productivity, new economy, structural changes



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