Source: The concept of labor-market “fissure” explains a lot of what’s wrong with the economy — Quartz by Allison Schrager
The dream of working your way up from the mail room to the corner office is no longer viable if everyone in the mail room is a contractor.
[Labor-market “fissure” is] what happens when more workers are contractors instead of employees.
Research by economists Larry Katz and Alan Krueger has explored the trends in alternative work arrangements like these (pdf). They estimate that non-standard employment (gig work, temp work, contractors) accounted for a around 10% of American workers between 1995 and 2005, but grew to some 16% of American employment in 2015. Much of the increase is attributable to “workers provided by contract firms.”
Short-term pressure to cut costs, such as during the global financial crisis, is not associated with greater workplace fissure, Krueger and Katz have found (pdf). This is a secular, not a cyclical, trend in the labor market.
Source: The concept of labor-market “fissure” explains a lot of what’s wrong with the economy — Quartz by Allison Schrager