The trends toward insecure employment relations -- or “flexible human resource management”, as they like to say over in the business school -- continues unabated. This has been a long-term strategy by capital to reduce labor costs, avoid long-term commitments to employees, dodge employee benefit responsibilities, and let workers absorb the costs of slack demand and seasonal downturns. This great “risk shift” has been well documented. Those who advocate free and unhindered labor markets, as a natural god-given form of freedom and liberty, should know that they do so in service to the interests of capital over labor. In the aggregate it is a form of class warfare disguised as a sound business practice – economically rational for the individual firm but collectively irrational in its larger destructive socio-economic consequences.
Some recent reports confirm the depth of this problem for workers. While the percent of the total seasonally adjusted nonfarm payroll positions accounted for by temporary services was only about 2%, the growth of employment in the temporary help services sector can be seem in the chart below.
A more widespread indication of the precarious labor situation can be found if one looks at the percent of the labor force that is made up of part-time workers. Today they account for about a fifth of the labor force, while accounting for much of the hiring gains since the onset of the Great Recession. It is also worth noting that fulltime employment is not yet back to pre-recession levels.
Clearly, US capitalism is incapable of generating sufficient employment and economic livelihood for a large portion of the working age population who seek jobs and income. The evidence on the reasons for the chronic inability of the US labor market to produce few fulltime and mostly part-time jobs would seem to support the Keynesian theory of insufficient demand. As the chief executive of the American Staffing Associations noted: “American businesses just have not had a sufficient increase in demand for products and services to add big numbers of workers.”
Whether this is now a permanent feature of US capitalism, or one that can be corrected with the traditional assortment of Keynesian fiscal remedies, remains to be seen. For the growing number of “stagnation” theorists, the problem may have deep structural roots that will require more radical action. More on that perspective in future posts.