Increasing Marketability of Temporary Staffing

[stebo0728]

I have a bit of a theory I would like to present. I imagine permanent payroll positions becoming a thing of the past in the next couple of decades. Why? There are more and more reasons these days that just make temporary staffing make more sense than permanent payroll staffing. There will still be permanent positions for the more sensitive or mission critical type positions, but for your everyday laborer, customer service agent, administrative assistant, office personnel type position, why hire permanent anymore? Reasons?

1. When hiring through a temporary staffing firm, the Family Leave Act does not apply. If an employee needs an extended time off, if they come from a temp firm, theres no legal obligation to hold their position open, you just call and request a new employee.

2. With "comprehensive immigration reform" on the horizon, hopefully a good portion of that will be steep punitive action towards companies that hire illegals. With that in mind, if you hire a temp staffer, you are not the one required to screen them. If a temp staffer is discovered to be an illegal, you can gasp, then request a new employee as the previous one is being deported.

3. Affirmative action is not an issue, you just take who the agency sends you, if they dont work out, you request someone else. If they send a woman, black man, asian lady, who cares as long as they do their job?

Anyone else see any other benefits to this system?

Anyone see an reason why this system is flawed, or where I am wrong?

[vikesfankevin1986]

It doesn't give the employee a chance to grow, get a raise or promotion. Where are you supposed to get your future higher up positions? I would rather have someone that already knows how things at a certain place work. I am a cook and yes cooking is cooking but every time you cook some place different, you need to learn that certain place. Some people have a hard time getting a job and will stay at a place doing a crappy job for years and years. What will they do if they are forced to be rehired again and again. How would they make a resume?
It would be good for business but horrible for the general population trying to find a job and progress in life.

[IBCoupe]

In addition, I see that you haven't explicitly taken into account turnover and training costs. Every time you hire someone new, you have to go through the process of documenting that process, and then you have to train the person and document that process. For large companies, that can be a lot of paperwork and a lot of money.

But it is an interesting thought.

[vikesfankevin1986]

Also I think the quality of the work will go down. There is no reason to work hard if you are going to be gone in a few months anyways. If you are trying to stay at that company and get a raise or promotion, you will work harder.

[wingFeather]

Many of the companies I have worked for in the past few years are becoming this way. I don't think they will ever be 100% this way, but it is definitely increasing. The employer has less responsibility to worry about, and more companies are outsourcing (especially with IT stuff) so they are getting very comfortable with paying less - less obligations - substandard quality of work (in exchange for less costs). For example, most companies are happy to have a website that sucks & doesn't work, if they can get rid of a full time web person & outsource the work to India.

Sad, but it's the way of the future.

[stebo0728]

It doesn't give the employee a chance to grow, get a raise or promotion. Where are you supposed to get your future higher up positions? I would rather have someone that already knows how things at a certain place work. I am a cook and yes cooking is cooking but every time you cook some place different, you need to learn that certain place. Some people have a hard time getting a job and will stay at a place doing a crappy job for years and years. What will they do if they are forced to be rehired again and again. How would they make a resume?
It would be good for business but horrible for the general population trying to find a job and progress in life.

I understand where your coming from there, and like I said, more sensitive or mission critical positions will be permanent based, so if you are the type of person that isnt motivated to improve then yes you will stay in the temp system. But if you strive you can move into a stronger position, and get the permanent job. Keep in mind I am not assuming overly dramatic turn over rates. Turn over rates are what they are regardless of whether a company uses a temp agency or not, or at least the divide between the two is diminishing. And as companies use more and more temp services, that will continue to less of an issue. People who now generally keep a job for a good while, they will begin to move into the temp world, and they will still keep their jobs a good while, but will be temp employees. Just because someone is a "temp" meaning they are basically subcontracted employment, paid by the temp agency and not the employer directly, that doesnt mean they have to be lumped in with people who bounce jobs every 2 weeks. There is long term potential there.

[wingFeather]

so if you are the type of person that isnt motivated to improve then yes you will stay in the temp system. But if you strive you can move into a stronger position, and get the permanent job.

Not necessarily. Lexmark has good, intelligent people that have been working "temporarily" for years. These people never seem to be able to advance... it keeps the payroll overhead low!

[stebo0728]

so if you are the type of person that isnt motivated to improve then yes you will stay in the temp system. But if you strive you can move into a stronger position, and get the permanent job.

Not necessarily. Lexmark has good, intelligent people that have been working "temporarily" for years. These people never seem to be able to advance... it keeps the payroll overhead low!

Is it because they are happy with the status quo, or do you think they are suppressed?

Certainly, with any issue, examples of both extremes can be presented, and usually are in a discussion of the issue, but its the middle ground that has the most relevance.

Also I think the quality of the work will go down. There is no reason to work hard if you are going to be gone in a few months anyways. If you are trying to stay at that company and get a raise or promotion, you will work harder.

What makes said employee believe they will be gone in a few months? We arent talking about temps who are filling temporary positions, we are talking about temps filling permanent positions. Positions that dont go away, even if the current employee does. Just as you pointed at training cost, once a company gets a person trained, its in their interest to keep that person in that position as long as the level of performance is acceptable.

[vikesfankevin1986]

What makes said employee believe they will be gone in a few months? We arent talking about temps who are filling temporary positions, we are talking about temps filling permanent positions. Positions that dont go away, even if the current employee does. Just as you pointed at training cost, once a company gets a person trained, its in their interest to keep that person in that position as long as the level of performance is acceptable.

Ok you confused me here. The word temporary makes the employee believe they will be gone in a few months. Even if a position is permanent, they are still a temp, meaning they will be gone. If the company plans to keep them, how is it any different than our current system?

[IBCoupe]

I just don't see much of the advantage, then. All you're doing is outsourcing HR, and the effects you point to don't seem to be much different from any other kind of at-will employment.

[stebo0728]

What makes said employee believe they will be gone in a few months? We arent talking about temps who are filling temporary positions, we are talking about temps filling permanent positions. Positions that dont go away, even if the current employee does. Just as you pointed at training cost, once a company gets a person trained, its in their interest to keep that person in that position as long as the level of performance is acceptable.

Ok you confused me here. The word temporary makes the employee believe they will be gone in a few months. Even if a position is permanent, they are still a temp, meaning they will be gone. If the company plans to keep them, how is it any different than our current system?

Because in my outlined system, the employee will remain an employee of the temp agency. They will continue to do the job they are doing, but they will never be permanently hired by the job provider.

Maybe instead of temp agency, we should say staffing agency. Perhaps my nomenclature is flawed a bit

[themadscientist]

I rely heavily on contracted labor and from my side it has advantages. When i need people they bring me people. If the people suck, they make them go away. My costs appear to be higher but when you consider additional benefits paid out to regular employees it works out to be cheaper. That being said, the trend towards this model concerns me.

Companies, both vendor and customer treat such staff like supplies, not people. These people build no equity in terms of clout in the company they are contracted out to and I see little to no potential for vertical movement in the contract company for them. This cultivates and ensures a permanent entrenched labor class to be used and thrown away. Those with regular positions will become less and less and move further away from the labor class and it's not a good thing.

[vikesfankevin1986]

I rely heavily on contracted labor and from my side it has advantages. When i need people they bring me people. If the people suck, they make them go away. My costs appear to be higher but when you consider additional benefits paid out to regular employees it works out to be cheaper. That being said, the trend towards this model concerns me.

Companies, both vendor and customer treat such staff like supplies, not people. These people build no equity in terms of clout in the company they are contracted out to and I see little to no potential for vertical movement in the contract company for them. This cultivates and ensures a permanent entrenched labor class to be used and thrown away. Those with regular positions will become less and less and move further away from the labor class and it's not a good thing.

Yea this is what I was trying to say as far as advancing. When I think of this idea it makes me think the rich get richer and the poor stay poor.

[Cold_Zero]

Interesting theory. A few issues with going to this staffing model:
1. Companies wont get the tax benefits, as a corporation, for their share of the employee compensation.
2. Under this model, employees (temps) dont have ownership in the company. Companies have found out that if employees have physical ownership through ESPs and Stock option grants they will work harder for the company.
3. As IBCoupe pointed out, training and turnover is a major issue. You also have issues with lack of experience and knowledge transfer when you have high turnover.

I just don’t see the risks out weighing the benefits.

Number 2 on your list isn’t that big of an issue. We have a lot of H-1B visa holders working here and even though the processe is a PITA, they still keep coming.

[wingFeather]

If you work on 6 month contracts, and you're not going to advance, then why work harder? The desire to improve the company - take a bullet for the company - is lost. Innovation is lost. Society stagnates... we only see the fruits of "good enough to get my contract renewed", instead of career men & women who give it their all.

[seang]

Even a six month contract is not granted, and will require ones all.

[stebo0728]

Ok so the local radio is discussing something interesting along the lines of employment today. What do you guys think about companies using applicants credit scores to determine job eligibility?

[IBCoupe]

I don't mind it; it shows a broad (if overly vague) indicator of personal responsibility. It doesn't, however, account for ID theft, and so I don't think that it should (or would) be used solely or even primarily. It's just another thing to consider.

The only thing that bothers me is the sense that it might feed into an economic gap, where you need to have money in order to have a decent chance of earning more.