Business

Temps are rising

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Call it temporary insanity.

While much was made of the fact that the US economy created a paltry 80,000 new jobs last month, even that dismal number was the best spin possible on the Bureau of Labor Statistics figures.

In fact, more than 30 percent of those jobs — 25,200 — were not permanent positions at all, but temporary jobs that come with no health care or other benefits, and that offer no job security. Call it the new normal for the US jobs market.

It used to be that a boost in temporary hiring was considered a good omen for the overall employment outlook — an indication that companies were getting ready to lock in workers to meet rising demand. But that’s changed, experts say.

“In today’s world, the reliance on temp agencies is akin to ‘just in time’ employment strategies — the use of temps is outpacing outright new hirings by a 10-to-1 ratio,” wrote David Rosenberg, chief economist at Gluskin Sheff, in a report on the June jobs report.

“The reality is that few businesses want to commit, and this shows through in the Household Survey as well, with part-time employment in an uptrend and full-time in a downtrend,” Rosenberg said.

Team Obama is more than happy to let that time-honored impression of temp workers getting full-time positions stand. Trouble is, the last few years have thrown cold water on that notion, and the tens of millions of American families with a temporary worker in their household or extended family know it. The number-crunchers may have overlooked the broad trend toward just-in-time employment, but millions of job seekers pounding the pavement have not.

On Friday morning, the University of Michigan reported its Consumer Confidence Index fell to its lowest level of 2012 in July — and, what’s more troubling, a mere 19 percent of Americans expect to be better off a year from now than they are today — a survey low.

The summer of 2012 finds Americans increasingly anxious, not less so, and the reason underlies the six monthly jobs reports that have been released so far this year. The anxiety arises because the employment picture is even worse than a cursory glance at the numbers would suggest — at least if you’re in the market for a stable, long-term job.

Indeed, the trend toward hiring temporary workers over permanent ones has only accelerated this year as hiring patterns have become increasingly entrenched. According to the folks at Manpower, the job-service company, only 30 percent of their temporary workers have ended up with permanent jobs this year. Compare that with 45 percent in 2011, and you can see that the outlook is not good.

There is little mystery as to why US employers have a growing “commitment problem.” ObamaCare is laden with new taxes and red tape that sharply raises the cost of each incremental new hire for small companies with more than 50 employees.

As Jim Amos, the CEO of the frozen yogurt chain Tasti-D-Lite warns that ObamaCare will “force franchisees to shift workers to part-time to avoid the 50-employee threshold.” If so, that could affect millions of low-paid workers.

ObamaCare is by no means the only idea the White House has cooked up to reinforce the trend toward replacing permanent workers with freelance ones. Last week’s pledge by the president to raise taxes on those families earning more than $250,000 will affect an estimated 900,000 small businesses — another incentive for employers to opt for a nimble work force with no strings attached.

So far this year, Team Obama has been able to ignore the quality of the new jobs being created, while crossing its fingers that the quantity would be passable — that is, just strong enough to avoid panic in the markets. The sentiment this fall may not be as sanguine.