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What Was Driving the 1982–88 Boom In Temporary Employment?

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  • Lonnie Golden
  • Eileen Appelbaum

Abstract

. The level of temporary help employment rose two‐and‐a‐half fold between 1982 and 1988, was quite variable and had a disproportionately larger effect on employment flows. One conventional explanation suggests that changing demographic composition of the labor force in favor of groups preferring nontraditional employment arrangements fueled the temporary help boom. Demand‐side views emphasize the volatility in labor demand, intensified price competition and the absence of employee benefit contributions. Empirical estimation confirms that demand‐side forces predominate. Yet no labor supply variable is found to be positively associated with the extent of temporary employment. Cyclical fluctuation in output, intensified foreign competition and the magnitude of nonwage labor costs are all positively associated with temporary employment levels. The diminishing bargaining power of labor unions allows employers to exploit the labor cost savings of temporary hires, and the extent of paid time‐off and the lack of flexibility in weekly hours of work play a weak role. The findings suggest why temporary job growth accelerated in the 1980s, as more firms employed a “core‐periphery” human resource strategy. Public policy should adopt measures that attempt to limit the creation of temporary jobs to a level that accommodates the worker need for flexible annual work schedules.

Suggested Citation

  • Lonnie Golden & Eileen Appelbaum, 1992. "What Was Driving the 1982–88 Boom In Temporary Employment?," American Journal of Economics and Sociology, Wiley Blackwell, vol. 51(4), pages 473-493, October.
  • Handle: RePEc:bla:ajecsc:v:51:y:1992:i:4:p:473-493
    DOI: 10.1111/j.1536-7150.1992.tb02730.x
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    Cited by:

    1. Matthew Dey & Susan Houseman & Anne Polivka, 2010. "What Do We Know About Contracting Out in the United States? Evidence from Household and Establishment Surveys," NBER Chapters, in: Labor in the New Economy, pages 267-304, National Bureau of Economic Research, Inc.
    2. Jamie Peck & Nik Theodore, 2007. "Flexible recession: the temporary staffing industry and mediated work in the United States," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 31(2), pages 171-192, March.
    3. Machiel van Dijk & Machiel Mulder, 2005. "Regulation of telecommunication and deployment of broadband," CPB Memorandum 131.rdf, CPB Netherlands Bureau for Economic Policy Analysis.
    4. Adam Seth Litwin & Sherry M. Tanious, 2021. "Information Technology, Business Strategy and the Reassignment of Work from In‐House Employees to Agency Temps," British Journal of Industrial Relations, London School of Economics, vol. 59(3), pages 816-847, September.
    5. Lee Byoung-Hoon & Stephen J. Frenkel, 2004. "Divided Workers," Work, Employment & Society, British Sociological Association, vol. 18(3), pages 507-530, September.
    6. Jeffrey B. Wenger & Arne L. Kalleberg, 2006. "Employers’ Flexibility and Employment Volatility," American Journal of Economics and Sociology, Wiley Blackwell, vol. 65(2), pages 347-382, April.
    7. Jamie Peck & Nikolas Theodore, 1998. "The Business of Contingent Work: Growth and Restructuring in Chicago's Temporary Employment Industry," Work, Employment & Society, British Sociological Association, vol. 12(4), pages 655-674, December.
    8. Coen N. Teulings & Nikolay Zubanov, 2014. "Is Economic Recovery A Myth? Robust Estimation Of Impulse Responses," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 29(3), pages 497-514, April.
    9. Belot, Michèle & Boone, Jan & van Ours, Jan C, 2002. "Welfare Effects of Employment Protection," CEPR Discussion Papers 3396, C.E.P.R. Discussion Papers.
    10. Genevieve Giuliano, 1998. "Information Technology, Work Patterns and Intra-metropolitan Location: A Case Study," Urban Studies, Urban Studies Journal Limited, vol. 35(7), pages 1077-1095, June.

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