Low-Income and Low-Skilled Workers Involvement in Nonstandard Employment. Chapter 4: What Happens To At-Risk Workers After Work In Alternative Work Arrangements?

The second component of the research question addresses how work in alternative work arrangements affects subsequent labor market outcomes for at-risk workers. This, of course, entails setting up a counterfactual--namely, how did an alternative work arrangement affect earnings and employment relative to what the at-risk worker would have been doing otherwise. There are two possible options for the counterfactual: the worker could have been in traditional employment, or could have not been employed at all. Fully analyzing this question requires the development of a model to construct appropriate comparison groups, controlling for demographic characteristics and employment histories. Subsequent earnings and employment outcomes can then be compared for those in alternative work arrangements and those in the comparison groups. A good source of data for such an analysis is the Survey of Income and Program Participation (SIPP). Although the Current Population Survey has excellent data on employment in alternative work arrangements and good outcome measures, it provides neither the sample size nor the data on work histories required for analyzing the impact of temporary work relative to a matched counterfactual. The SIPP has a weaker measure of alternative work arrangements--the only available measure is employment in the temporary help industry--but it provides relatively large sample sizes, good outcome measures, and considerable data on work history. The work history data is particularly important for trying to match temporary workers with appropriate comparison groups.(55)