At Swarovski’s plant in Cranston, almost one-third of the 350 workers making delicate jewelry and crystal gifts last week were not employed by the company. Instead, they were supplied by Talent Tree, a temp agency that provides labor as needed for the plant.
In recent years, Talent Tree has supplied 50 to 200 workers at any given time, Swarovski spokeswoman Melissa Carden said. The agency keeps a staffer on site, and along with paying the temps, it provides benefits and pays bonuses for good attendance and productivity.
“The biggest reason why we use them is for flexibility, because our business is very seasonal,” Carden said. “We also have many demands for orders that have short turnaround times.” And since a restructuring last year that cut 122 jobs at the plant (across all functions), managers have been reluctant to hire new permanent staff for what may still be shifting labor needs.
“We are kind of still in transition, trying to figure out what’s the right mix,” Carden said.
Swarovski is not alone in its reliance on temps. Across Rhode Island, temp agencies employed almost 11,000 people in the third quarter of 2004, up almost 27 percent from 2002. Of those, the state Department of Labor and Training estimates, just over one-quarter were in production jobs – the closest the statistics come to gauging manufacturing employment.
In the big picture, that’s still a small share of the labor force: about one for every 20 staff jobs. But consider that 700 manufacturing jobs were lost between January 2004 and January 2005, while temp jobs increased, and the shift becomes clearer.
It’s not a new phenomenon: A National Bureau of Economic Research study found that between 1972 and 1997, the number of temps in manufacturing grew from 34,000 nationwide to about 707,000, and the number of hours they worked rose from 53 million to 1.3 billion.
The trend accounts for part of the pronounced growth in U.S. manufacturing productivity, the study found, because temps aren’t counted in the manufacturing work force. But has it also limited long-term hires? An Employment Policies Institute study found that while, from 1992 to 1997, U.S. firms added only 550,000 staff jobs in manufacturing, temp agencies created another 505,000. Those jobs might not have existed at all, however, had employers not had the flexibility to hire temps to meet market demand, the researchers concluded.
The alternative – hiring staff and then letting them go if conditions sour – can really hurt a company, the American Staffing Association argues. In a recent issue brief, the trade group pointed out that the stocks of companies that cut more than 15 percent of their work forces during the 1991 recession performed well below average.
Temp agencies don’t have that problem. When the economy is growing, their rolls quickly grow – the peak was 2.54 million in average daily employment, in 2000, according to the American Staffing Association, up from 1.05 million in 1992. (In Rhode Island, temps peaked in 1998, at 12,769). And when the economy shrinks, agencies cut back: In 2002, average daily employment was down to 2.06 million; in the last two years, it’s risen again.
The extra-vulnerable manufacturing sector has clearly caught on. As of 1999, the U.S. Bureau of Labor Statistics found, 29.7 percent of temps were working in manufacturing, compared with 16.5 percent of staff workers. But they also earned far less than their counterparts.
The difference in wages and benefits (which not all agencies provide) has created a great deal of concern within Rhode Island’s Latino communities especially. Immigrant workers have been disproportionately affected by the shift toward temporary labor, said state Rep. Grace Diaz (D-Providence), with large numbers now having no choice but to take temp jobs.
“It’s good for the companies and it’s good for the agencies – it’s the poor people who are suffering,” she said. “They pay the minimum most of the time, and keep the difference.”
Temp use is by no means universal among Rhode Island manufacturers. At Amgen, in West Greenwich, there are a few temps in non-production jobs, but none in manufacturing, said spokesman Larry Bernard. And at American Insulated Wire, in Pawtucket, the union contract doesn’t allow it, said Manny Sousa, business manager for the International Brotherhood of Electrical Workers. “It’s among our top priorities,” he said.
At Electric Boat, the need for security clearances alone would make temps unusable, said spokesman Neil D. Ruenzel, but it’s not an option anyway.
“The work that our people do is highly skilled – it’s the high end of any kind of trade activity,” Ruenzel said. “It takes years of apprenticeship and training and development to be able to do the work required for a submarine. We have occasionally brought people in for a short duration, but they were probably retirees who had great expertise.”
Temp agencies may not be able to supply submarine builders, but that doesn’t mean they don’t have skilled workers, especially in this labor market. Darlene Lepore, area vice president for Adecco, a major staffing company, said her agency tests all workers’ job skills, math and knowledge of safety issues, and does “behavioral interviewing” as well.
“Manufacturers like the testing we do because it assures them they’re going to get a good person,” she said. Adecco also supplies production workers with computer skills, to deal with the increasingly sophisticated machinery at local factories.
During the recession, Lepore said, most manufacturers sought only short-term temps, but now the outlook is changing. “We have seen not only longer assignments, but many, many more temp-to-hires,” with workers getting staff jobs after three to five months.
At Swarovski, Carden said some of the temps at the Cranston plant may still get hired as well.
“Our goal isn’t to have permanent temps,” she said. “If we see we have an emerging need, we will start to look at alternatives.”
