Low-Income and Low-Skilled Workers Involvement in Nonstandard Employment. Job Outcomes

10/01/2001

Turning to the specifics, an examination of the first column in Table 4.1 shows that if we compare workers who were initially not employed and then took temporary help work with a comparison group that were not employed in both periods (i.e., was not employed in both months in the initial period), the latter had only a 35 percent chance of being employed a year later. By contrast, the group that moved from nonemployment to temporary employment had almost twice the likelihood of being employed, at 68 percent.(58)

Table 4.1
Outcomes a Year Later:  Means by Comparison Groups and Differences
in Means for Temporary Workers as Compared with Comparison Groups (t-statistics in parentheses)
  Status in base period
Comparison Group 2b: Not Employed to Not Employed Comparison Group 1b: Employed to Not Employed Comparison Group 2a: Not Employed to Employed Comparison Group 1a: Employed to Employed

Outcome a year later

Full Sample At-Risk Full Sample At-Risk Full Sample At-Risk Full Sample At-Risk

Job Outcomes

Employment:

Comparison Mean

0.345 0.346 0.566 0.556 0.730 0.718 0.876 0.840

Temporary Job Differential

0.336 0.329 0.268 0.200 -0.048 -0.043 -0.043 -0.083
  (18.19)* (13.33)* (11.75)* (4.80)* (-2.07)* (-1.36) (-2.86)* (-2.92)*

Hourly wages among those employed:

Comparison Mean

8.23 7.60 9.68 8.28 8.72 9.00 11.45 8.57

Temporary Job Differential

-0.080 0.182 1.535 1.092 -0.567 -1.220 -0.237 0.805
  (-0.24) (0.73) (3.99)* (1.82) (-1.45) (-2.43)* (-0.84) (1.67)

Hours per week:

Comparison Mean

11.67 12.10 19.95 20.65 25.95 25.66 33.14 30.58

Temporary Job Differential

13.04 12.52 11.22 8.26 -1.24 -1.03 -1.97 -1.66
  (17.49)* (12.61)* (11.66)* (4.62)* (-1.28) (-0.79) (-2.89)* (-1.29)

Job Quality Outcomes

Private health insurance coverage:

Comparison Mean

0.570 0.414 0.594 0.363 0.628 0.513 0.767 0.568

Temporary Job Differential

0.018 0.047 0.119 0.201 -0.040 -0.051 -0.054 -0.004
  (0.90) (1.78) (4.79)* (4.53)* (-1.58) (-1.48) (-2.96) (-0.11)

Health insurance from employer:

Comparison Mean

0.138 0.132 0.203 0.147 0.279 0.274 0.501 0.377

Temporary Job Differential

0.109 0.134 0.173 0.135 -0.031 -0.008 -0.124 -0.095
  (6.50)* (5.99)* (7.31)* (3.61)* (-1.35) (-0.27) (-6.40)* (-3.13)*

Welfare Recipiency/Poverty Status

Public assistance:

Comparison Mean

0.184 0.281 0.145 0.269 0.129 0.184 0.065 0.143

Temporary Job Differential

-0.035 -0.062 -0.066 -0.124 0.020 0.035 0.014 0.003
  (-2.31)* (-2.71)* (-3.93)* (3.28)* (1.08) (1.25) (1.24) (0.12)

Medicaid receipt:

Comparison Mean

0.150 0.231 0.112 0.205 0.098 0.140 0.042 0.088

Temporary Job Differential

-0.038 -0.068 -0.066 -0.124 0.014 0.022 0.004 -0.007
  (-2.81)* (-3.31)* (-4.57)* (-3.82)* (0.86) (0.89) (0.47) (-0.37)

Less than 200% poverty:

Comparison Mean

0.500 0.737 0.447 0.728 0.421 0.612 0.321 0.676

Temporary Job Differential

-0.091 -0.123 -0.126 -0.118 -0.012 0.003 -0.001 -0.065
  (-4.53)* (-4.73)* (-5.03)* (-2.77)* (-0.45) (0.08) (-0.04) (-2.02)*
Source:  SIPP 1990-1993 panels, calculations by the Urban Institute.
Note:  At risk defined as below 200% of family poverty level in month prior to reference month.
*  Significance of the coefficient estimates at the 0.05 level.

Temporary work appears to have positive effects even when we look at the set of workers who moved from nontemporary employment to temporary employment and compare them to a set of workers with similar characteristics who moved from nontemporary employment to nonemployment in the initial period. Again, while the latter group have a 57 percent chance of being employed a year later, the temporary workers most like this comparison group improved these odds by 27 percentage points, and had an 83 percent chance of having a job a year later. These probabilities were quite similar for the at-risk groups of initially not employed and initially employed temporary workers, sitting at 68 percent (34.6 percent + 32.9 percent) and 76 percent (55.6 percent + 20.0 percent), respectively.

This picture changes markedly when we examine the cohort of workers who moved from nonemployment to temporary work and compare them to a set of similar workers who went from nonemployment to nontemporary employment in the initial period. Nearly three-quarters (73 percent) of the latter group was employed a year later, compared with 68 percent of the temporary work group. The same is evident when we compare the group that moved from nontemporary employment to temporary work to those that stayed in nontemporary employment. The movement to temporary work dropped the probability of being in employment a year later from 88 percent to 83 percent. It is worth noting that the drop is about twice as large for the at-risk group of workers--their employment probabilities drop from 84 percent to 76 percent.

The story is very much the same for earnings outcomes. Temporary help employment generally improves earnings outcomes among those employed when the comparison group is those who were not employed (although this is not statistically significant); earnings are lower when compared to the experience of similar workers who got nontemporary jobs. The sole exception to this is the at-risk workers who moved from nontemporary employment to temporary employment rather than stay in nontemporary employment--their earnings gain was substantial (about 10 percent). We suspect, however, that this is a result of using earnings as a selection criterion for the at-risk group.

The third set of rows investigates the effect of temporary work on hours worked (including the effect of non-work). Again, the results are strikingly different depending on which comparison group is used. Workers who were not employed in both initial periods or transitioned from nontemporary employment to nonemployment had quite low hours a year later--ranging from 12 to 20 hours a week. Those who transitioned into temporary employment worked almost twice as many hours as those who were not employed in both of the initial periods, and half as many again as those who transitioned into nonemployment from nontemporary employment.(59) The effect is slightly lower for at-risk workers, however.

The negative effects of temporary work when compared to nontemporary employment are quite small--they are completely insignificant when the comparison group is workers who moved from nonemployment to nontemporary employment, and only just over an hour a week when compared to those who stayed in nontemporary employment.