A quarter of jobs in America pay below the federal poverty line for a family of four ($23,050). Not only are many jobs low-wage, they are also temporary and insecure. Over the last three years, the temp industry added more jobs in the United States than any other, according to the American Staffing Association, the trade group representing temp recruitment agencies, outsourcing specialists and the like.
Low-wage, temporary jobs have become so widespread that they threaten to become the norm. But for some reason this isn’t causing a scandal. At least in the business press, we are more likely to hear plaudits for “lean and mean” companies than angst about the changing nature of work for ordinary Americans.
How did we arrive at this state of affairs? Many argue that it was the inevitable result of macroeconomic forces — globalization, deindustrialization and technological change — beyond our political control. Yet employers had (and have) choices. Rather than squeezing workers, they could have invested in workers and boosted product quality, taking what economists call the high road toward more advanced manufacturing and skilled service work. But this hasn’t happened. Instead, American employers have generally taken the low road: lowering wages and cutting benefits, converting permanent employees into part-time and contingent workers, busting unions and subcontracting and outsourcing jobs. They have done so, in part, because of the extraordinary evangelizing of the temp industry, which rose from humble origins to become a global behemoth.
The story begins in the years after World War II, when a handful of temp agencies were started, largely in the Midwest. In 1947, William Russell Kelly founded Russell Kelly Office Service (later known as Kelly Girl Services) in Detroit, with three employees, 12 customers and $848 in sales. A year later, two lawyers, Aaron Scheinfeld and Elmer Winter, founded a similarly small outfit, Manpower Inc., in Milwaukee. At the time, the future of these fledgling agencies was no foregone conclusion. Unions were at the peak of their power, and the protections that they had fought so hard to achieve — workers’ compensation, pensions, health benefits and more — had been adopted by union and nonunion employers alike.
But temp leaders were creating a new category of work (and workers) that would be exempt from such protections.