As `Good' Jobs Become `Bad' Jobs, Congress Takes a Closer Look
Senator sees `alarming implications' in rise of `contingent' workers
WASHINGTON — THERE are good jobs and there are bad jobs. Lately, millions of Americans are ending up with the bad jobs - no benefits, no security, low pay.
One of them was Wendy Perkins, who lost her position as a stockbroker in Beverly Hills, Calif., in the late 1980s, and suddenly found herself on a rapidly-declining financial escalator.
Desperate for income, Ms. Perkins worked as a part-time receptionist ($6-an-hour), clerked in a retail store, sold her car to raise cash, and began house-sitting to keep a roof over her head. Most of her personal belongings were lost when she could not pay the storage fees.
Congress now is taking an interest in people like Perkins. Sen. Howard Metzenbaum (D) of Ohio says the number of "contingent workers" like her without full-time, steady jobs has grown to 25 percent of the labor force, and could rise to 50 percent by 2000.
Senator Metzenbaum warns: "This trend has alarming implications for working men and women in this country, for our standard of living, and for our economy as a whole."
The rise of a contingent work force is not well documented or understood, even by labor experts. The government's Bureau of Labor Statistics tracks part-time, temporary, and self-employed workers. But BLS economists admit there are no good data on a new class of workers who scramble frantically from job to job, often without any benefits, and with a growing sense of insecurity.
Richard Delaney, a representative of the Office and Professional Employees International Union (AFL-CIO) says such workers are multiplying rapidly. He points to employees at Bank of America, the nation's second largest bank.
In testimony this week before a Senate Labor and Human Resources subcommittee, Mr. Delaney said a work force overhaul at the bank has taken a heavy human toll. Thousands of bank employees were transferred into "part-time and temporary jobs with no job security and little or no benefits," he told the senators.
Delaney cited examples, including a 14-year bank employee whose hours were cut from 30 per week to 19. He said: "This woman had worked a second job at a convenience mart to supplement her low wages. After the cut in hours at the bank, her second job became her primary job."
Peter Magnani, a spokesman for Bank of America, says the effects of recent changes there are being "wildly exaggerated." He says the restructuring was necessary to meet customer needs. The 28,000 branch employees of BA now work hours similar to those in a retail store, including Sundays, rather than a regular Monday-to-Friday schedule.
Magnani confirms that the number of full-time employees was reduced - from 28 percent of the branch staff in April 1992, to 19 percent this year. Full-timers who lost their jobs got generous severance packages, and were also permitted to keep working part-time while they looked for another full-time post, he says.
But Magnani concedes: "In terms of long-term trends, it is fair to say we have participated in the trend in our industry to have more hourly and part-time employees."
Businessmen, too, can be hurt by such restructuring. Michael Hobbs, a custom home builder in New Canaan, Conn., complains that to cut costs, some of his competitors are replacing full-time workers with "independent contractors," who are actually the same employees under a new designation.
"We lose a lot of jobs to competitors who cheat," he told the senators. Hobbs noted that the going price for a carpenter in Western Connecticut is $27.78 an hour, including wages ($17.80), fringes ($3), Social Security ($1.33), workers' compensation (4.57), and unemployment taxes ($1.08).
Competitors using independent contractors pay just $8 an hour, and avoid paying all benefits and taxes, Hobbs says.
Yet solutions won't be easy. Companies are desperate to cut costs. Competition is fierce. Survival is the watchword. Employees often seem expendable.
Metzenbaum says: "I don't have a legislative solution.... But I think something has to be done, and the committee will be receptive to any ideas that anybody has."
Meanwhile, some displaced workers are finding their own niche. One is Perkins, who is now promoting her book, "Temporarily Yours," documenting cases of abuse of "temp" workers.