Hourly workers hit hard by recession

U. CHICAGO (US)—A record number of U.S. workers are involuntarily working part-time due to reduced hours or the inability to find a full-time job.

Hourly workers—the majority of the wage and salary workforce—are especially susceptible to reduced, irregular, and fluctuating hours—and the myriad of challenges associated with them—according to a new report.

Although much has been made of the hardships facing the nearly 10 percent of Americans out of work in the current recession, many workers approach this Labor Day having held onto their jobs while being disadvantaged, say researchers at the University of Chicago.

Hourly and especially part-time workers receive limited formal employee benefits from their employers, and in many cases, are not eligible for public benefits such as unemployment insurance, cash assistance, or family and medical leave.

In addition, their work schedules are typically set with limited advance notice and subject to last-minute changes, resulting in unpredictable schedules. Changes in public policy as well as company practices could help these workers, the researchers contend.

“Certainly the current recession is contributing to underemployment, as evidenced by the proportion of American workers classified as ‘involuntary part-time,’” says associate professor Susan Lambert.

The numbers
The Census Bureau uses the term for those who work less than 35 hours a week because they could not find a full-time job or those who work reduced hours due to “slack demand.”

In November 2009, 9.2 million workers fell in this category, the highest level in recorded history.

Other recessions also have seen an increase in involuntary part-time workers, she said. For example, the labor market added 1.5 million involuntary part-time workers between 1981 and 1982 for a total of 6.8 million workers, surging up again to add 2.3 million between 1992 and 1993 for a total of 6.7 million workers.

“I think it is important to underscore that employment has become increasingly precarious over the past 30 years, not just during recessionary periods, due to structural changes in the economy, reductions in labor protections, and evolving employer practices that pass risk from the market onto workers,” Lambert says.

“The current recession highlights these insecurities, bringing much-needed attention to the plight of disadvantaged workers who are struggling to keep their jobs as well as maintain sufficient hours to make ends meet. The problems faced by hourly, low-level workers are unlikely to go away when the economy fully recovers.”

Last-minute stress
In good times and bad, employers frequently use “just-in-time” scheduling practices—setting hourly workers’ schedules with limited advance notice to accommodate fluctuating demand—as a means of maintaining a tight link between labor costs and demand.

Unpredictable schedules not only make it harder for workers to determine their incomes, they also make it hard to plan for childcare and family life, associate professor Julia Henly says.

“Unpredictable work schedules can translate into instability in family routines and practices, placing additional burdens on already strapped and busy families, their caregivers, and extended family members,” she says.

“We find that hourly retail employees with more predictable work schedules report lower levels of stress, less work-to-family conflict, and fewer work interferences with non-work activities such as scheduling doctor’s appointments, socializing with friends, and eating meals together as a family.”

Key findings

Lambert and Henly are investigating the management and employee sides of scheduling practices in their study, which tracked a national retail apparel firm. Their report shows:

  • Hours vary substantially for both part-time and full-time hourly workers in this firm, with full-time employees working more hours but also experiencing the greatest fluctuations in hours from week to week.
  • The more hours employees work and the less their hours fluctuate, the longer they remain employed at the firm, even after taking into account factors such as age, race and job status.
  • Job turnover is high, particularly for part-time sales associates, younger workers, African Americans, and recently hired workers.
  • Management practices contribute to job turnover above and beyond individual worker characteristics. Stores in which managers pursue a strategy of keeping their staff size small with the goal of providing each sales associate with sufficient hours have lower turnover and higher retention rates than stores in which managers keep their staff size large.

Flex time
Workplace flexibility has become an important topic in public policy debates as more parents seek ways to reconcile demands of their jobs with family life. Flexibility options that are frequently touted include allowing workers to work reduced hours, work at home, or vary the start and end times of the workday.

According to Lambert and Henly, options that reduce job rigidity make sense for managerial and professional jobs characterized by long and rigid hours. But they caution that conventional flexibility options do not map well onto the jobs of many low-level hourly workers, who face fluctuating hours, too few rather than too many hours and place-bound job duties that preclude bringing their work home.

“Fortunately, policymakers, advocacy groups, and researchers are becoming increasingly interested in developing and promoting flexibility options for U.S. workers in hourly jobs. As these initiatives proceed, it will be important that they reflect the range of work conditions found in hourly jobs, including low-wage jobs in service industries,” Lambert and Henly write in their forthcoming paper.

Creating flexibility options for low-level hourly workers will be one topic addressed in a series of four regional conferences organized by the White House in the coming year. The first of the forums will be held Oct. 7 in Dallas on the issue of flexibility in small businesses. Forums in both Los Angeles and Chicago are tentatively scheduled for early 2011 and will focus on flexibility in low-wage jobs and in the manufacturing sector, respectively.

Henly and Lambert expect that the need of low-level hourly workers for stable and adequate hours and for benefits defined in both public and employer policy will be discussed.

The study received support from the Ford Foundation, the Russell Sage Foundation, and the Annie E. Casey Foundation.

More news from the University of Chicago: http://news.uchicago.edu/

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2 Comments

  1. Tony - KS

    “Divide and Conquer” is a well-known strategy for war and is the end-game outcome of a less-than-full employment economy.

  2. Jim Larsen

    More jobs might be available if it were feasible to start businesses. Unfortunately current regulations tend to favor established names in the industries (as they have the money and power to lobby), making startups prohibitively risky ventures for the poor and lower middle class.

    $100,000 dollars in capital is nothing to a brewing industry giant in America, but that same dollar figure represents the entire monetary beginning of a modest startup that may gainfully employ as many as 5 people immediately.

    Wealth inequality clearly suppresses economic growth, and capitalism depends on growth to function. The obvious solution is tax reform.

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