Is permanent employment becoming a thing of the past?
Daylight streaks the morning sky as employees all across Vermont are making their way to work. For many of them, their jobs are more than just a day's wage or even the fulfillment of years of training, schooling and career ambition. They represent monthly mortgage payments, buffers against spiraling health costs, long-term investments in a child's college education and the promise of a comfortable retirement. In a word, security. But as in so many aspects of 21st-century America, security has become a disappearing commodity in the current labor market.
In Burlington, Anthony Scampoli, branch manager of Labor Ready, drags a wooden sign out to the sidewalk advertising day jobs for anyone willing to work. It's barely 5 a.m., but already the sign seems superfluous as a steady flow of people -- mostly men -- enters the brick storefront in the Old North End. A dozen-odd people, work vouchers in hand, wait patiently in the lobby for Scampoli to call out their names with a job offer for the day. It's a take-it-or-leave-it scenario. By 7 a.m. nearly all of them will be gone to job sites as near as downtown Burling-ton or as far as St. Johnsbury or Hogans-burg, New York.
For a growing number of Americans, the traditional work arrangement of steady hours, predictable paychecks, vacation and sick time and long-term benefits is being replaced by something more transient. Temp work, seasonal help or "independent contracts" -- the term staffing agencies prefer -- is contingent labor, meaning that your job is contingent upon there being work to do. If there's no work today, come back tomorrow. Nationally, nearly three in 10 workers are now employed in non-standard labor, and the percentage has been creeping upwards since the early 1990s.
Contingent labor is not a new phenomenon, but it's become the signature of the global economy. Of the three million jobs lost since the latest recession began, at least one million disappeared since the recession "officially" ended. As employers remain skittish about the current economic recovery, they're reluctant to commit to hiring full-time staff. So at virtually every level of the workforce -- from unskilled laborers to highly trained professionals -- the trend is toward hiring temporary workers. That means more and more Americans face the prospects of lower wages, less job security, fewer benefits and little or no bargaining power with their employers.
At the Burlington branch of Labor Ready, business is brisk. The nation's largest employer of temporary manual labor opened here in September 2000. Vermont was the last state in the country to open a Labor Ready office and within months, Scampoli boasts, his branch ranked number one in the nation for sales growth. At least some of the permanent jobs lost in Vermont's manufacturing sector are now filled by temp laborers, though no one can say for sure how many.
The jobs at Labor Ready are mostly entry-level. "You name it, we do it all," Scampoli says. "Factory, dishwashing, pick-and-pack It's a great concept. We get people from all walks of life and give them jobs. We get college kids coming in, part-timers looking to augment their pay. I've even had a few IBMers come in."
A quick survey of the morning crowd confirms its diversity. An 18-year-old Brooklyn man living in Burlington for the summer says he's just looking for a few weeks of work. A 35-year-old woman from South Burlington who has been coming to Labor Ready for three months says she likes the freedom -- and having cash in her pocket every night. Forty-seven-year-old Antonio Vasquez has been searching for months for a permanent job. He comes in just to make ends meet. "It's an opportunity, know what I mean?" Vasquez says. "You don't have to be out there panhandling."
As the morning rush subsides, Scampoli takes a break to explain why a growing number of Ver-mont employers are turning to temporary labor. "If they need guys, it's like a water faucet," Scam-poli says. "When you don't want 'em, you shut it off."
That faucet doesn't just control the flow of entry-level workers. Consider, for example, the 500 jobs eliminated last month at IBM, a company once revered as a lifetime employer. Some have interpreted the cutback as a sign that high-tech jobs are in decline in Vermont. But those layoffs also represent a shifting attitude by employers away from the traditional labor model.
Chris Johnson is director of Technical Connec-tion, a "boutique" staffing firm for highly skilled professionals, particularly those in the computer and engineering sectors. Johnson says he's seeing a resurgence in computer jobs; his payroll literally doubled in the last two months alone. "We're quite optimistic going forward," says Johnson, whose wage and hour figures are collected by the Federal Reserve as a barometer of long-term job growth.
By most measures, the people Johnson serves are at the opposite end of the employment spectrum from the folks waiting for dishwashing jobs at Labor Ready. Technical Connection clients are highly skilled and well educated, and earn anywhere from $12 to $70 an hour. Many qualify for insurance benefits, sick time, vacation days and retirement plans. And Johnson claims that, nine times out 10, the positions his firm provides lead to direct, full-time employment. "We find the word temporary' to be offensive and demeaning to our employees. That's our philosophy," says Johnson. "We consider them professional contractors who are in transition."
Nevertheless, these jobs are still contingent labor, subject to the whims of employers. And like many of the manufacturing jobs in Vermont that were lost in recent years, they too are threatened by the flow of jobs overseas. Johnson says he's particularly troubled about "offshoring" -- the practice by which large companies such as IBM import high-tech workers from countries like India, train them here and then return those employees and their jobs to their home country. Those workers, dubbed H-1B employees because of their immigration status, are paid considerably less than their American counterparts and have little job security.
"They're like indentured servants," Johnson says. "[The employer] can make unreasonable demands of these workers because they hold the threat of revoking their work permission. So if they don't toe the line, they get shipped home and their H-1B is revoked The bad thing is that employers like IBM are becoming accustomed to that level of control over their employees. I see that as a very onerous development."
As contingent labor becomes a more acceptable modus operandi in the private sector, it's begun encroaching upon the public sector as well. "The trend is that many states are developing policies to sign agreements with temp agencies," says Tim Costello, a labor expert with the North American Alliance For Fair Employment in Boston, which tracks labor trends. "As a way to control the head count in government, a lot of times they'll short-staff departments and then use temps to fill in. And, of course, that shows up [in their budget] as a cut in staffing, which they like." Those jobs, which once were largely clerical and day-laborer types, have expanded into a broad range of civil-service duties, including sophisticated consulting jobs, information technology work and so on, Costello adds.
To a certain extent, Vermont has managed to buck this national trend. In the last three years, fewer state jobs were filled by contingent or contracted labor. In large part, that's due to efforts by the Vermont State Employees' Association. Representing 5500 state workers, VSEA is Vermont's largest union. Several years ago the organization successfully lobbied to restrict the number of hours a temp can work for the state in a single year. And in 1998, VSEA pushed the Legislature to restrict the number of "personal service contracts" awarded to independent contractors, which at the time were costing the state hundreds of millions of dollars.
Still, that trend could quickly reverse if the Douglas administration continues to follow the path of the Bush administration in its push to privatize government jobs, claims VSEA director Annie Noonan. "They're going to cut 36 Department of Employment and Training jobs So who's going to help the thousand or so IBM employees between now and February or whenever the next ax falls?" she asks. "The reality is, it won't be the 36 DET employment service counselors who just got laid off."
Noonan predicts that those employment services will eventually be contracted out to a private employment agency where job security, benefits and other civil-service protections simply don't exist.
Noonan and others don't deny that the state of Vermont will always have to rely on some short-term labor, such as independent contractors for construction projects, seasonal workers in the state parks and extra bookkeepers during tax season. But where the private sector leads, the public sector often follows. As one manager of a Vermont employment agency put it, "There is a huge untapped market out there for staffing firms in government. It's the wave of the future." What remains to be seen is what can be done to prevent traditional, full-time jobs from being swept away by the tide.