5 Reasons Behind Our Part-Time Economy

parttime_659x439pxThere’s a workplace phenomenon that’s evolving subtly, but surely. Our nation’s workforce is becoming more and more a part-time work force. There are growing numbers of part-time workers and shrinking numbers of full time workers. The blunt unemployment data we see each month does a poor job at getting under that issue. In fact, anyone who has a job (part or full time) is “employed”. The Underemployed get lost in the data.

I’ve heard much chatter about the looming Affordable Care Act (Obama Care) provision of the 30-hour per week cutoff, which mandates health coverage to those who work 30+ hours for a company of 50 employees or the company must pay a penalty. However I believe the chatter grossly overstates this provision as the primary cause of the issue. The part-time phenomenon is real, has been growing for many years, but the cause is rooted in a changing Economy.

In general, companies are getting far smarter on evaluating their hiring needs and are also becoming more flexible with their work forces. But with that flexibility come the reality that many company’s needs are not based on the traditional Monday-Friday from 9am to 5pm paradigm. That flexibility opens the door to part-time work force.

So from my perspective here are the 5 underlying reasons:

1. The Great Recession and its lingering aftermath have changed the structure of the work force.

Those seeking work have taken jobs they can attain, and a part-time job is largely more attainable than full-time employment. There are now 28 Million part-time jobs in the US, 3 Million more than in 2008 when the recession began. A recent Gallup survey indicated that 1 in 5 workers are now part-time, and the percentage has been growing.

2. Traditional industries like manufacturing which fueled full time employment have been in decline, while service industries, which by definition have more “peaks and valleys”, have grown.

Thirty-five years ago 25% of the US workforce had a manufacturing job. Today that number is less than 10%.

3. Business are getting smarter about deploying their work forces

Retail businesses in particular have gotten more sophisticated about using analytics to map hourly staffing needs and they schedule their labor accordingly.

4. Health care costs and benefit costs are an issue

The Affordable Care Act did not create the issue. The issue had existed and has grown. As a result companies are more reluctant to hire a full-time salaried employee. In many cases, a part-time employee without benefits is a lower cost solution to a hiring need.

5. The growth of independent contractors

A growing number of independent contractors provide industry with a variable work force and reduce the need for full-time employees.

All of these issues are real and aren’t going away. Unfortunately the overall economic growth of our nation can be stymied by a growing part-time work force. A part-time worker, even one lucky enough to cobble together two or three part-time gigs, is a frugal one who is understandably merely trying to make ends meet.

While the nation appears to be moving forward from the worst of the dire economic issues of the end of the last decade, real economic growth won’t be fueled by continued high unemployment and serious underemployment.

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