Are We Becoming a Part-Time Economy?
(Federal Reserve of Atlanta) "Compared with 2007, the U.S. labor market now has about 2.5 million more people working part-time and about 2.2 million fewer people working full-time. In this sense, U.S. businesses are more reliant on part-time workers now than in the past."
The ratio of part-time to full-time workers in January 2015 was 22.8 as compared to 20.3 in December 2007 or 20.7 in December 2000. There were 898,000 fewer full-time workers in January 2015 than in December 2007, while there were 2,801,000 more part-time workers. Though there were 1,903,000 more men and women working in January 2015 than in December 2007, there were 898,000 fewer full-time workers. We are 7 years and 1 month from the beginning of the recession, and full-time employment is still 898,000 below the level of December 2007. (Bureau Labor Statistics)
This helps to explain why real median household incomes were still significantly lower in December 2014 than in December 2007 and even lower than in June 2009 when recovery began. This just one more example of how labor markets have been distorted; managers have confirmed their control over hiring and the workforce and these markets do not work in a proper supply-demand mode. The other obvious example of distortion is the point about productivity rising in the period before, but no gains were seen in wages. The distortion also effected a windfall in gains to managers of capital. Economic policy may wish to remediate, at least if you are on the side of EPOP ratios improving and you measure success in domestic-workforce terms. If you believe that non-market economics led to distortion of the labor markets and windfall gains, perhaps this is also a reason to justify windfall taxation policies as well (since these gains were unfairly and uneconomically gathered, they were not earned by the people who actually got the money). It may also justify a modest increase in social security earnings checks too, as this is, at least, a modest way to correct for the inappropriate, distortionary wage results of that period. And as for the part-time labor market now, this also means we need to look at Fair Labor Standards policy and enforcement. The distortion of labor markets for a generation do not justify continuation of similarly thoughtless policies. (Sentier Research)
Remember the old days, when a son would follow in his dad's footsteps and work in the local factory (or mine, etc.) — and work there for the rest of his life (maybe for 40 or 50 years) — until eventually, he would pass the torch — whereas his son would then later do the same thing?
Nowadays it seems, people don't take jobs and stick around for every long — and "job-hopping" is not only the new norm, but many employers now see this as a positive trait in job candidates. (It used to be, job-hopping was viewed as a sign of irresponsibility and a lack of commitment and loyalty).
From the Bureau of Labor Statistics' last JOLTS report (Job Openings and Labor Turnover Summary): "Over the 12 months ending in December 2014, hires totaled 58.3 million and separations totaled 55.4 million, yielding a net employment gain of 2.9 million. These figures include workers who may have been hired and separated more than once during the year."
To put this into perspective: The Bureau of Labor Statistics says we have a labor force of 155.5 million workers. So that means, on average, over the course of one year, well over 1/3 of the entire labor force is playing Musical Chairs with churn in the labor market. Could this be because of the dramatic rise in “temp workers” and "independent contractors"?
Even with budget cuts (and excluding the U.S. military and Post Office), the U.S. government is still (and always has been) America's largest job creator , currently with about 2.1 million employees (Even though Speaker John Boehner always insists that "government doesn't create jobs.")
Walmart is the largest private sector employer with more than 1.4 million U.S. employees. (A Reuters survey of 52 stores run by the largest U.S. private employers showed that 27 of them were only hiring temporary workers — including America's largest employer, who Walmart calls "flexible associates").
America's second largest private sector employer is a temp agency called Kelly Services, which provided employment to 555,000 employees in 2014. (Then there's McDonald's with 440,000 employees in the U.S. and UPS with 344,000 employees in the U.S.)
Back in the old days, the largest employers used to be companies like GM, Bell, Ford, GE and U.S. Steel. Now it's Walmart and a temp agency.