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  1. #1 Say goodbye to full-time jobs with benefits 
    Say goodbye to full-time jobs with benefits

    By Chris Isidore, senior writerJune 1, 2010: 11:40 AM ET


    NEW YORK (CNNMoney.com) -- Jobs may be coming back, but they aren't the same ones workers were used to.

    Many of the jobs employers are adding are temporary or contract positions, rather than traditional full-time jobs with benefits. With unemployment remaining near 10%, employers have their pick of workers willing to accept less secure positions.

    In 2005, the government estimated that 31% of U.S. workers were already so-called contingent workers. Experts say that number could increase to 40% or more in the next 10 years.

    James Stoeckmann, senior practice leader at WorldatWork, a professional association of human resource executives, believes that full-time employees could become the minority of the nation's workforce within 20 to 30 years, leaving employees without traditional benefits such as health coverage, paid vacations and retirement plans, that most workers take for granted today.

    "The traditional job is not doomed. But it will increasingly have competition from other models, the most prominent is the independent contractor model," he said.

    Doug Arms, senior vice president of Ajilon, a staffing firm, says about 90% of the positions his company is helping clients fill right now are on a contract basis.

    New college degree, no job
    "[Employers] are reluctant to bring on permanent employees too quickly," he said. "And the available candidate landscape is much different now. They're a little more aggressive to take any position."

    Cathy, who asked that her last name not be used, lost her job as a recruiter for a financial services firm in February 2009. She started working on a contract basis four months later. She believes that many employers are taking improper advantage of the weak labor market.

    "I work in HR, I understand that sometimes you need to hire a contractor because you have a project and you won't need the person when it's done in three months," she said. "But that's not what's happening here."

    Cathy said her co-workers who had permanent jobs didn't treat her differently, but she still felt like a second-class citizen.

    "At one job they were giving out H1N1 flu shots but the contract workers weren't eligible to receive them," she said. "I said 'You guys are still in trouble if I get the flu.'"

    Much of the change is due to employers' desire to limit their costs. Stoechmann equates the shift to the one seen in retirement plans, in which employers moved away from the traditional pension plan toward defined contribution plans, which passes more of the burden onto the employee.
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  2. #2  
    Our widdle friend. Wei Wu Wei's Avatar
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    If only we were seriously pushing for pro-labor, pro-worker policies like I've been saying for years.

    The very structure of the economy is changing, we went from a nearly 100% domestic manufacturing economy to a global economy based on low-skilled service jobs which are easily replacable or outsourcable.

    This is the nature of change of the economic structure, and while it benefits the companies who are able to get cheaper and cheaper labor, it hurts workers.
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    PORCUS MAXIMUS Rockntractor's Avatar
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    Quote Originally Posted by Wei Wu Wei View Post
    If only we were seriously pushing for pro-labor, pro-worker policies like I've been saying for years.

    The very structure of the economy is changing, we went from a nearly 100% domestic manufacturing economy to a global economy based on low-skilled service jobs which are easily replacable or outsourcable.

    This is the nature of change of the economic structure, and while it benefits the companies who are able to get cheaper and cheaper labor, it hurts workers.
    Bah bah bah bleat bleat bah!
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    Power CUer FlaGator's Avatar
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    Quote Originally Posted by Wei Wu Wei View Post
    If only we were seriously pushing for pro-labor, pro-worker policies like I've been saying for years.

    The very structure of the economy is changing, we went from a nearly 100% domestic manufacturing economy to a global economy based on low-skilled service jobs which are easily replacable or outsourcable.

    This is the nature of change of the economic structure, and while it benefits the companies who are able to get cheaper and cheaper labor, it hurts workers.
    That is not necessarily true, as wages decline the cost of production declines and the cost of living declines. A company can not sustain those type of high profits if no one can afford their goods and services. Prices come down in order to create a demand. That is the way of capitalism. If capitalism is left to it's own devices (within the bounds of reason) the price of goods will level out at what the market can bear.

    Union protection has outlived its usefulness and now labor goals are not longer so much about the employee as they are about the survival of he union. Employees only benefit in that the unions have to have some tangible service to sell its members. There are enough labor laws on the books to protect workers so unions strive for higher wages. Higher wages create higher cost goods and that creates a higher cost of living because the market can now bear over priced goods.

    I work in one of the most outsourced professions in the U.S. and thanks be to God I have had no problem finding and maintaining employment and my income has actually increased. I do not have a union and by the grace of God have found success in the capitalist system.

    I believe in Christianity as I believe that the sun has risen: not only because I see it, but because by it I see everything else.
    C. S. Lewis
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    PORCUS MAXIMUS Rockntractor's Avatar
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    Wee Wei weenie says workers of the world unite!
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    Senior Member malloc's Avatar
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    Quote Originally Posted by FlaGator View Post
    That is not necessarily true, as wages decline the cost of production declines and the cost of living declines.
    Exactly, and the inverse is also true, and very devastating to those who are the supposed beneficiary of governmental pro-labor policies.

    For instance, suppose there are 5 labor groups in a given economy, the annual average cost of living is $1,000. The five labor groups don't start off equally. Let's say that fry cooks make $900, mechanics make $1,000, factory workers make $1,100, executives make $1,500 and bankers make $2,000. In this example it's clear that fry cooks and mechanics might be poor, factory workers and executives might be lower- and upper-middle class, and the bankers are on top.

    The labor groups unionize, and the fry cooks negotiate a 50% wage increase, the mechanics negotiate 20% and the factory workers negotiate 10%. So the current annual wages now look like this:

    fry cooks: $1350
    mechanics: $1200
    factory workers: $1210
    executives: $1500
    bankers: $2000

    Now everyone is above the $1,000 poverty line aren't they? Isn't that what pro-labor policies have done? Unfortunately, in order to facilitate the raise in wages, the cost of living expressed in prices must also rise. Either that, or labor must be laid off, which would cause one of two effects, either the lost labor would be automated, which costs money and increases prices, or production would lag demand which increases prices, and on top of that you would have high unemployment.

    Labor expenses have increased by 32%, which would also increase the cost of living by a similar amount. So now the poverty line is around $1320 annually. So the fry cooks are now above this line, but at the expense of the mechanics, factory workers, and to some extent the executives. Now the fry cooks are still poor, but the mechanics and factory workers are more poor. On top of this lies the feedback loop wherein, factory workers, and executives buy less burgers, factory goods and cars because they are being priced out.

    So now the mechanics and factory workers re-negotiate for another 10% raise to 'get above' the poverty line, and the inflationary cycle repeats itself, each time one group of unionized labor displaces another group in a game of leap frog.

    This same example also applies to hikes in minimum wage rates, and there are several other consequences, such as less overall employment and more investment in automation that stems from hikes in the minimum wage.


    Henry Hazlitt explains it better than I.

    I would say this temp and contract hire trend has more to do with market uncertainty, than with labor costs. If I had a large business I would make sure I either had fixed costs at the present via contract labor, or I could have the stop-loss mechanism of laying off temps if things went south, and credit didn't come through for a project or something like that.
    Last edited by malloc; 06-01-2010 at 08:03 PM.
    "In England a king hath little more to do than to make war and give away places; which in plain terms, is to impoverish the nation and set it together by the ears. A pretty business indeed for a man to be allowed eight hundred thousand sterling a year for, and worshipped into the bargain! Of more worth is one honest man to society and in the sight of God, than all the crowned ruffians that ever lived."
    —Thomas Paine, Common Sense
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    Our widdle friend. Wei Wu Wei's Avatar
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    Quote Originally Posted by FlaGator View Post
    That is not necessarily true, as wages decline the cost of production declines and the cost of living declines. A company can not sustain those type of high profits if no one can afford their goods and services.
    Prices come down in order to create a demand. That is the way of capitalism. If capitalism is left to it's own devices (within the bounds of reason) the price of goods will level out at what the market can bear.
    This assumes a purely domestic system where the company only works within the country and only hires within the country and only sells within the country. This is not true in this new age of Global Capitalism.


    Union protection has outlived its usefulness and now labor goals are not longer so much about the employee as they are about the survival of he union. Employees only benefit in that the unions have to have some tangible service to sell its members. There are enough labor laws on the books to protect workers so unions strive for higher wages. Higher wages create higher cost goods and that creates a higher cost of living because the market can now bear over priced goods.

    I work in one of the most outsourced professions in the U.S. and thanks be to God I have had no problem finding and maintaining employment and my income has actually increased. I do not have a union and by the grace of God have found success in the capitalist system.
    Unions don't have any power any more, not like they did several decades ago. Workers need to keep pushing for their own interests.
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    PORCUS MAXIMUS Rockntractor's Avatar
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    Quote Originally Posted by Wei Wu Wei View Post
    This assumes a purely domestic system where the company only works within the country and only hires within the country and only sells within the country. This is not true in this new age of Global Capitalism.




    Unions don't have any power any more, not like they did several decades ago. Workers need to keep pushing for their own interests.
    You are either ignorant or a liar, almost all government jobs are union now.
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    CU's Tallest Midget! PoliCon's Avatar
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    Quote Originally Posted by Rockntractor View Post
    You are either ignorant or a liar, almost all government jobs are union now.
    actually - you have that a bit off . . . . I believe that union members count for between 30 and 40 percent of government employees - but government employee's count for nearly 60% of union members despite the fact that there are 5 times more workers in the private sector.

    ETA: Yup. I'm right: http://www.bls.gov/news.release/union2.nr0.htm
    Stand up for what is right, even if you have to stand alone.
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    PORCUS MAXIMUS Rockntractor's Avatar
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    Quote Originally Posted by PoliCon View Post
    actually - you have that a bit off . . . . I believe that union members count for between 30 and 40 percent of government employees - but government employee's count for nearly 60% of union members despite the fact that there are 5 times more workers in the private sector.

    ETA: Yup. I'm right: http://www.bls.gov/news.release/union2.nr0.htm
    They will be before long. in my area i can't think of any local government jobs that aren't union. schools, fire police, public utilities etc....
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