This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Economic Rebound Bolsters Temporary Hiring

With temporary employees, companies would be able to avoid paying for costly benefits, such as health insurance. These skilled workers would come together to form temporary organizations or "virtual companies" that would exist only until a given project was completed.

MIT predicted a date for such a shift as 2015, but some analysts believe that transition has already begun.

Research by Littler Mendelson, a Chicago-based employment and labor law firm, estimates that contingent workers will constitute 50% of the workers hired by companies after the economy recovers. Temporary employees could eventually make up 25% to 35% of the total workforce.

"You are constantly seeing businesses reinvent themselves," says GJ Stillson MacDonnell, a lawyer at Littler Mendelson. "This goes to the fundamental issue of how we produce things. Is there anybody five or 10 years from now who will be correct if they say they are a permanent employee?"

The use of contingency workers on a project-based basis is not a new business model. Littler Mendelson cites Hollywood film production companies as an example. These companies bring together talent from various sectors, from actors to caterers, to complete a specific project. Once a film is completed, they move on to the next available production.

The firm also points to Cox Communication, which assigns much of its infrastructure improvements on a project-based basis. Similarly, Nike (NKE) may design and market its shoes in-house, but most other manufacturing needs have long been outsourced. Though the company has declined to give a definitive tally, analysts estimate that Microsoft (MSFT) has as many as 88,000 contingent workers who supplement its more than 96,000 traditional employees.

2 of 3

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
SYM TRADE IT LAST %CHG
AAPL $130.28 0.00%
FB $81.53 0.00%
GOOG $565.06 0.00%
TSLA $218.42 0.00%
YHOO $44.52 0.00%

Markets

DOW 18,080.14 +21.45 0.12%
S&P 500 2,117.69 +4.76 0.23%
NASDAQ 5,092.0850 +36.0220 0.71%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs