Temp Workers on The Rise

GERRI: ALL THAT AND MORE, BUT FIRST, OUR TOP STORY, THE BOTTOM LINE OF TEMPORARY JOBS. THEY'RE BECOMING A PERMANENT WAY OF LIFE FOR SOME MANY PEOPLE OUT THERE. IN FACT, THE SECOND-LARGEST EMPLOYER IN THE COUNTRY, AND THE COUNTRY IS THAT TENT AGENCY. COMES RIGHT AFTER WALMART, WHICH ITSELF IS A HEAVY USER OF TEMPORARY WORKERS. WHAT HOLDS MORE WEIGHT IN OUR ECONOMY? THE QUALITY OR THE QUANTITY. HERE TO WEIGH IN, ECONOMIC PROFESSOR AT THE UNIVERSITY OF MARYLAND. AND THIS CEO, A COMPANY HELPING BUSINESSES HIRE TEMPORARY WORKERS. I HOPE I PRONOUNCED CORRECTLY. >> YOU GOT IT EXACTLY RIGHT. GERRI: I LOVE THAT. CO-STAR WITH YOU. I FIND THIS TREND DISTURBING. THE IDEA THAT THE SECOND BIGGEST EMPLOYER IN THE COUNTRY AS A TEMPORARY SERVICES AGENCY SAYS THAT THERE IS SOMETHING DEEPLY WRONG WITH THIS ECONOMY. >> CERTAINLY WE ARE CREATING MANY MORE TEMPORARY JOBS AND PERMANENT JOBS THESE DAYS. THEY DON'T SUPPORT A FAMILY, THEY DON'T EVEN SUPPORT AN INDIVIDUAL, AND IT STANDS FROM A LOUSY JOBS MARKET. THE NEW HEALTH CARE LOT ENCOURAGES EMPLOYERS TO TAKE TO JOBS AND TURN THEM INTO THREE SO THAT THEY CAN AVOID PAYING BENEFITS. EVEN WITHOUT THE MANDATE, BENEFIT COSTS ARE SKYROCKETING. GERRI: NO BENEFITS, NO RETIREMENT. THE LIST GOES ON AND ON. IT DOES NOT SUPPORT AN INDIVIDUAL, LET ALONE A FAMILY. YOUR ENTIRE BUSINESS MODEL IS BUILT AROUND, VERY INTELLIGENTLY SO, TEMPORARY WORKERS. WHY THE THINK THIS IS NOT THREATENING TO OUR ECONOMY. >> I EVERY WITH YOU. TEMPORARY WORK FORCES ARE GROWING FASTER THE ECONOMY. MANY BUSINESSES, THE TEMPORARY WORKFORCE IS BECOMING PERMANENT. I THINK IS A DID -- IT IS A DOUBLE-EDGED SWORD. AT THE SAME TIME BUSINESSES LOOK TO CUT COSTS. THE CATEGORY OF BUSINESSES -- THE CATEGORY OF JOBS THAT FALL UNDER THIS TEMPORARY RUBRIC IS GROWING. IT IS NO LONGER JUST A CASHIER AT WALMART, BUT TEMPORARY LAWYERS, ACCOUNTANTS, TECHNICIANS, SOFTWARE DEVELOPERS , AND WHAT BUSINESSES ARE LOOKING TO DO IS HAVE FLEXIBILITY IN TERMS OF THE COST STRUCTURE WHICH IS WILL WE SEE IN SOME OF THE NUMBERS. GERRI: YOUR FLEXIBILITY IS MY PAIN IN THE BUTT. YOU KNOW, I FIND THIS SO DISTURBING. 12 PERCENT OF WORKERS ARE TEMPORARY. LET'S GET BACK TO MY QUESTION OF QUALITY VERSUS QUANTITY. WHICH WILL YOU CHOOSE IN THIS SCENARIO? MORE PERMANENT WORKERS TO MORE PERMANENT JOBS, OR MORE TEMPORARY WORKERS. >> WELL, WE CLEARLY WANT MORE PERMANENT JOBS, NOT TO DIG IT -- A WAY OF GETTING STARTED A NEW JOB OR AREA OR FILLING IN FROM HERE TO THERE, BUT MOST PEOPLE LONG TERM HAVE TO HAVE A PERMANENT JOB, EVEN IF IT IS NOT AS AN EMPLOYEE BUT A CONSULTANT. A COMMITMENT. THEY'RE IS A LOT OF THAT IN THE LEGAL SECTOR, THE BIG LAW FIRMS. IT'S REALLY NECESSARY. YOU CANNOT MAKE ENDS MEET LONG-TERM. YOU CAN ALWAYS TALK ABOUT THE BENEFITS OF TEMPORARY WORK, BUT IT IS DISTURBING THAT WE ARE CREATING SO FEW PERMANENT JOBS. ONE HAS TO ASK WHY. GERRI: LET'S ASK BOB. WHY ARE WE, YOU KNOW, DEVELOPING SOME MANY OF THESE TEMPORARY WORKERS? IS THERE SOMETHING SPECIAL ABOUT THIS ECONOMY, THIS POST GREAT DEPRESSION, GREAT RECESSION ECONOMY THAT MEANS COMPANIES ARE JUST UNWILLING TO COMMIT TO FULL-TIME WORKERS? >> THAT IS EXACTLY RIGHT. I THINK AFTER 2007, WHAT HAS HAPPENED IS BUSINESSES ARE GUN SHY. THEY NEED RESOURCES, THE TALENT. NEEDING TO MAKE THAT INTO THE COST STRUCTURE, SEEING THIS IMPACT OF INCREASING PENETRATION OF TEMPORARY WORK FORCE MORE THAN EVER. GERRI: I THOUGHT THIS WAS INTERESTING TO READ A RECENT SURVEY OF ECONOMISTS THAT SHOWS THAT THREE-QUARTERS OF THEM BELIEVE THAT THIS TREND IS PERMANENT. SO ECONOMISTS, EVEN PEOPLE WHO MAY REGARD THE CREATION OF TEMPORARY JOBS AS A GOOD THING BECAUSE IT IS A JOB, THIS IS BECOMING A PERMANENT THING, SOMETHING NEW TO OUR ECONOMY. WHAT KIND OF LONG-TERM IMPACT WILL THERE BE? >> FOR ONE THING PEOPLE WILL BE ABLE TO PREPARE ADEQUATELY. WORKING ON A TEMPORARY BASIS, HAVING MULTIPLE PART-TIME JOBS, THINGS OF THAT NATURE, PEOPLE WILL NOT SAVE MUCH. THEY DON'T SAVE ENOUGH AS IT IS AND WILL NOT BUILD UP PENSION BENEFITS WITH EMPLOYEES, THINGS OF THAT NATURE. WE WILL HAVE AN ELDERLY POPULATION THAT IS WHOLLY UNPREPARED. I PREDICT THERE WILL BE A BIG PUSH FOR AN EXPANSION OF WHAT WE KNOW AS SOCIAL SECURITY. A BROADER TAX BASE, HIGHER RATES SIMPLY TO PROVIDE SOCIAL SECURITY. THIS WILL END UP COSTING US IN MORE TAXES AND GOVERNMENT, AND I DON'T KNOW WHETHER THAT'S GOOD FOR ANY PART OF THE PRIVATE SECTOR AND ALL. GERRI: BOB, ONE OF THE BIG QUESTIONS -- YOU ALWAYS HEAR THAT TEMPORARY WORK ULTIMATELY CREATES FULL-TIME JOBS. YOU MOVE FROM TEMPORARY WORK IN TO SOME KIND OF FULL TIME POSITION. IS THERE ANY INDICATION THAT THESE JOBS WILL BLOSSOM INTO A FULL-TIME POSITION? >> I THINK THERE ARE TWO INTERESTING STATISTICS. 7 PERCENT OF U.S. EMPLOYERS SAY THEY HIRE TEMPORARY AS A WAY TO GET FULL-TIME PERMANENT POSITIONS, BUT THE NUMBER FOR CITED REASON. SECOND IS GLOBAL STATISTICS SHOW THAT COHORTS OF THE UNEMPLOYED WHO DO PARTICIPATE IN THE TEMPORARY WORKFORCE OVER 12 MONTHS HAVE A LOWER UNEMPLOYMENT RATE. IT IS DEFINITELY A GATEWAY. OF COURSE COME YOU DON'T WANT THE TEMPORARY WORK FORCE TO OVERWHELM THE GROWTH OF PERMANENT WORK FORCE WHICH THE WHAT IS HAPPENING TODAY IS WE'RE SEEING TEMPORARY WORK FORCE GREW AT FIVE TIMES THE RATE OF THE ECONOMY. A DISPROPORTIONATE MOVE. GERRI: THAT IS THE GLAMOR. I HAVE TO ASK YOU ABOUT SOMETHING THAT IS A LITTLE TANGENTIALLY RELATED. WE HAVE GOT -- AND THESE ARE NUMBERS THAT ASTONISHED ME TODAY . I HAVE TO ASK YOU. WE HAVE MORE AMERICANS ON FOOD STAMPS, MORE AMERICANS ON FOOD STAMPS AND WE DO IN THE PRIVATE SECTOR WORKING. TAKE A LOOK AT THESE NUMBERS. 101 MILLION PEOPLE ON FOOD STAMPS. 97 MILLION WORKING FULL TIME. WHAT DOES THAT SAY ABOUT OUR ECONOMY? >> TWO THINGS. ONE, THE ECONOMY IS TRADING LOW-WAGE JOBS SO THAT PEOPLE CAN FIND WORK BUT NOT ENOUGH HOURS AND THEY QUALIFY FOR FOOD STAMPS ARE NOT HIGH ENOUGH WAGE. ESPECIALLY IF THEY HAVE KIDS. THE OTHER, ACTIVELY RECRUITING PEOPLE TO SIGN UP FOR FOOD STAMPS, PEOPLE THAT MIGHT NOT BE INCLINED BECAUSE OF PRIDE OR SOME OTHER WAY OF GETTING ALONG. IT BRINGS MONEY INTO COMMUNITIES. THE FEDERAL GOVERNMENT SENDS MONEY TO A RURAL COMMUNITY WITH A LOT OF POTENTIALLY ELIGIBLE PEOPLE AND THAT PROMOTES THE GROCERY STORE. SO THE GROCERY INDUSTRY WANTS PEOPLE TO SIGN UP AND THEY DO IT THROUGH LOCAL GOVERNMENTS AND NONPROFITS WHISPERING AND TO TRY TO GET PEOPLE ORGANIZED AND INTO THE PROGRAM. GERRI: UNBELIEVABLE.