The constant push to increase labor productivity in the workplace has led to the creation of workplace conditions and an environment in which employers expect their workers to do more while paying them less.
Not only does this changing dynamic affect the employees personally, but it could have far-reaching effects that may have a profound impact on the economy down the road, The Los Angeles Times reports.
According to the news source, the U.S workforce is reporting more than ever that there seems to be very little job security, especially among the contingent workforce. Considering these workers feel as if they could be let go at moment's notice, it isn't logical to assume that they're in any position to spend large sums of money, a key factor in helping the country's gross domestic product expand. The changing state of the workforce has also made it much harder to advance through a company, and with fewer promotions given out, employees may quickly feel trapped in a job that they aren't sure they'll keep.
"Nobody is secure these days," said Robert Reich, a professor at UC Berkeley who served as labor secretary for President Bill Clinton. "Every permanent job can either be replaced by software or outsourced abroad or given to contract workers."
The media outlet pointed out that although contract staffing has been a major leader in job creation in recent years, there could be a side effect to this hiring. In fact, the rise in the use of contract staffing could be one of the largest factors limiting consumer spending. Many employers are opting to use such workers in place of bringing employees on full-time and having to pay their benefits, such as healthcare and retirement. Many of the positions often filled by the contingent workers were jobs that once belonged to staffed employees.
"Companies are saying, 'I don't need to hire a worker in a permanent job for many of the things that used to be done before,'" said Steven Berchem, chief operating officer at the American Staffing Association. "Things are changing rapidly and businesses have to adapt quickly. Having a flexible workforce is best."
Statistics from the Aberdeen Group show about one in four people currently employed work in a contract position. This suggests that 25 percent of Americans are paying their own healthcare costs, and many of them aren't even certain they'll have a check waiting for them at the end of the pay period. This, experts say, could be detrimental to the future of consumer spending, which makes up 70 percent of the country's GDP.
Many who work in contract positions say the often wait for days on end to learn if they would have work on a particular day. Santos Castaneda, for example, said he did this for five months, during which he earned 4,200, and sometimes went from working 26 hours one week to 10 the next.
"We (America) allow employers to change terms and conditions of employment and to get rid of employees easier than anybody else in the world," said Kenneth Dau-Schmidt, a labor law professor at Indiana University. "When the economy is going well and things are booming, that's good for us because employers add employees. When things are going poorly, they can readily get rid of employees. It increases the instability of the economy."
However, some companies have proposed labor solutions that are changing the way employers utilize the contingent workforce. By bringing workers on with a pay-for-performance goal, these companies can see higher employee satisfaction, lower turnover and, in turn, lower labor costs.