Economic Snapshot | Wages, Incomes, and Wealth

Tracking the temporary workforce

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Snapshot for November 15, 2000

Tracking the temporary workforce

Two official government data sources give widely differing estimates of the size of the temporary help industry. One set of data collected from employers (sometimes referred to as the establishment survey) indicates that more than 3.5 million workers are employed in the temporary help industry. Since 1972, employment in temporary help services has grown, on average, 11.4% per year, according to this measure.

But in another collected set of data — the household survey — the government asks workers which industry they work in. The graph below shows that the results from the household-based survey tend to indicate that far fewer workers are employed in the temporary help industry than is suggested by the establishment survey. In 1999 the household survey estimated that 1.07 million workers, or 0.8% of the U.S. workforce, are employed in temporary positions — fewer than a third of the number reported in the establishment survey.

Temporary help agency employment as tracked by the establishment and household surveys

So which of these surveys is more accurate? Most analysts believe the big difference between these two surveys comes about because many workers are either unaware of working for a temporary help agency or are reluctant to report it. Many temporary workers have long standing relationships with their host employers and may have been on assignment for weeks or even months. Consequently, these workers may no longer think of themselves as employed by temporary help agencies like Manpower or Kelley Services, even though, in reality, they are.

The establishment survey asks 600,000 employers about their payroll records, and most analysts believe this survey provides the most accurate information available. Based on these establishment data, the growth in temporary help employment has been phenomenal and has continued throughout the 1990s. This trend is surprising since many analysts expected growth in these less desirable jobs to diminish during an economic expansion that has been accompanied by historically low unemployment.

This week’s Snapshot by EPI economist Jeffrey Wenger.

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