53 Million Temps: All You Need To Know About The "Jobs Recovery"

Tyler Durden's picture

After years of ignoring the obvious, the Federal Reserve has been finally forced to admit that the labor force participation rate matters, and in fact has started to point it out as a clear negative when it comes to Yellen's "dashboard" of thresholds which will allow the Fed to raise rates (for the obvious reason that the Fed is desperate to delay ZIRP as long as possible and is now highlighting all that is wrong with the economy, contrary to Obama who is still focusing on all the rigged greatness of the US recovery) and to do so is going through Zero Hedge archives to note all those things which everyone had ignored for years and which we have pointed out as structural failures of the so-called recovery. 

So while we are happy to oblige the Fed with our tens of thousands of articles summarizing what is broken with the US economy thanks to, well, the Fed, here is another one: one which the Fed can use next year when the time to hike rates has come and gone, and when the Fed is once again scratching its head what to blame it on.

The chart below shows the civilian employment to population ratio: a convenient indicator of the real state of the US labor market which does away with the labor force entirely, and the associated rhetoric of why it may or may not be plunging, and merely focuses on two simple things: total population and the total civilian population of the US. One thing is clear: the ratio crashed when the depression started and has flatlined since. Which, incidentally, may be all you, and the Fed, needs to know about the recovery.


But wait, it gets worse, because according to the WSJ, roughly one in three U.S. workers is now a freelancer.

Wait, how many?

Fifty-three million Americans, or 34% of the nation’s workforce, qualify as freelancers, according to a new report from the Freelancers Union, a nonprofit organization, and Elance-oDesk Inc., a company that provides platforms for freelancers to find work. These individuals include independent contractors, temps, and moonlighters, among others.

So 53 million, let's call them, temps? That is probably the most stunning number we have seen in years, and flips the entire premise of a "job recovery" on its head.

The experience of work has fractured in recent years, said Fabio Rosati, chief executive of Elance-oDesk. Layoffs that accompanied the recession forced many individuals to forge a living from short-term gigs, while online marketplaces such as Elance, TaskRabbit and Uber emerged to match independent workers with companies or individuals in need of labor. Plus, the rise of mobile technologies allow more people to work when and where they choose.

Or not work, considering there is no contract tying them to a job.

Independent workers “don’t have the workforce protections that have developed over the last 80 years. They are simply on their own,” said Robert Reich, the Secretary of Labor under President Bill Clinton and now a professor at the University of California, Berkeley. An accurate census would help policymakers determine how to fill gaps, he said.


Counting the number of contingent workers has not been a high priority in Washington, DC over the last couple of decades. The number “is likely to be large and growing and there is no political advantage in signaling that fact,” Mr. Reich said.

The punchline:

Companies, eager to lower payroll costs and take advantage of a more flexible workforce, are relying more on contingent labor. According to the National Employment Law Project, temp jobs now constitute an all-time high of 2% of all positions in the U.S., or 2.8 million.

So the Fed is trying to boost wages and generate demand-pull inflation at a time when some 53 million US workers, or a third of total, are "freelancers", which is a polite way of saying part-time workers and "moonlighters."

Well.... good luck!

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LawsofPhysics's picture

"Officially", yes.  Capital and talent are still going where they are respected and there is plenty of economic activity out there, it's just increasingly more off the official ledger.

same as it ever was.

knukles's picture

Zandi said he didn't believe it.  I don't believe Zandi.  Mrs K doesn't believe me.  And my golf buds don't believe my handicap.  So we're all square with the disbelief shit, right?

kliguy38's picture

sounds like my life too...... 

Relentless101's picture

Sell those 53 million on an adjustable rate mortgage and we will have come full circle!

Divided States of America's picture

Temps are easily disposable when you need to shed cost VERY FAST...and we all know the real economy can fold like a house of cards at any moment now.

Zirpedge's picture

Temps should find extra time to give back to the community. I have a feeling that alot of the malcontents here are unemployed and unmotivated to find a way to contribute to society. Those that don't agree with the president should become community organizers and walk a mile in President Obama's shoes. Selective Services is looking for regional managers. https://www.sss.gov/default.htm Or you could become active in a local food bank or any number of charitable organizations. Or we could all sit around and play sky is falling and cry about things we can't control, boo hoo. 

FreedomGuy's picture

As the complexity, risk and costs of hiring a potential long term employee rise...the number who will be employed will fall. It is not complicated.

Giving free time away is not a virtue when the whole reason you have free time is because of job loss or moving down the economic ladder.

It would be easy to walk a mile in Obama's shoes...which are generally golf shoes.

James_Cole's picture

As the complexity, risk and costs of hiring a potential long term employee rise...the number who will be employed will fall. It is not complicated.

Yeah, nothing to do with the gamblers tanking the economy in 2008 lol. It's all dem rega-lations holdin' back deh job crea-tin!!


Zirpedge's picture

Alot of negativity here, why all the downvotes malcontents?

James, so you think gambling and risk taking is bad? Maybe you should take the easy route, get on welfare and food stamps like the rest of the lazy Americans.


James_Cole's picture

I happen to love gambling personally, but I don't do it by illegally risking (stealing?) other peoples money and then demand a bailout when I massivley fuck up lest the whole world economy collapse into chaos - as by design.

Skateboarder's picture

Can we stop using the word 'illegal' already. For fuck's sake, things are either (un)lawful or (im)moral. Legality is a noose dressed as a bandanna.

Yes We Can. But Lets Not.'s picture

Freelancing, circa 2014.  Here, based on personal experience, is about how it works.  Gubmint contractor X sees your resume online, calls you up.  It goes well, they want to hire you on hourly basis for 1-2 year project. 

BUT.  They won't be the employer, they have outsourced that to company Y.  You'll have an X business card, but you get your paychecks from Y.  X tells you to call company Y, which will take 'a small %' for handling payroll, etc.  You call Y, an 'outsourcing' firm.  Y asks what you need to make.  You say you got $x/hr on your last gig.  He says he can do that.  Hold it - what about that 'small percentage'?  You ask Y what he will bill you out to X at per hour.  He won't say!  So you cannot figure out how much he is taking.  Basically, X lets Y get whatever he can.  If you as contractor don't just roll over and accede, Y will get back to X and tell them he isn't comfortable with you.  And then you are toast, outta work, and then Y will roll the next candidate.  Y will pay the next contractor $60/hour and bill him out to X and $125/hour, making a huge spread for every hour contractor works.  Y gets 10, 50, 100 of these contractors working under this arrangement, gets rich in a hurry.  I'd guess Y is probably kicking a bit back to X for allowing him to get away with this.

The whole effing arrangement is a disaster and a disgrace.  I'll tell you one thing, there are some 'outsourcers' out there getting plenty rich, and there is a lot of sleaze.  And a lot of unhappy contractors.

Skateboarder's picture

Dude, my buddy worked for a company that contracted for Metro PCS, Sprint, etc. to do antenna installations and testing, etc. He got paid $30/hr. The company was charging the telecoms $3000/hr. Takes roughly five people, two on-site, and three off-site, to do an install. All of 'em bill at $30. One manager bills at $50. Everyone but the owners and the manager is a temp. The rest of the $2800 likely goes toward yachts, bitchez, and McMansions.

wee-weed up's picture

Shaaa-zaamm! Obozo's 6th Annual Summer of Recovery worked!

Dadzrites's picture

That's exactly what lawfirms do.  They charge $125/hr.  for paralegals but only pay them $25-$40/hr.  Then they bill you for the associates at $200-$300 per hour, but only pay them $100 per hr.

Dead Man Walking's picture

James, with an attitude like that, you may not be MF Global material.

FreedomGuy's picture

So, James, you would assert that if labor and risk get more difficult, more expensive and riskier, the market will respond inversely and do more?

This would be the leftist wet dream.

James_Cole's picture

So, James, you would assert that if labor and risk get more difficult, more expensive and riskier, the market will respond inversely and do more?

Risk tends to be expensive, ask your local bank for a business loan and you'll see they agree with me...when lending money.  

Employment corresponds largely to demand and localization. 

If your product is in demand and you can manufacture it successfully in bangladesh your workforce isn't going ot cost much. If your product is in demand but you must hire locals in US&A your workforce is going to cost a lot more...but silver lining! If you can make that local workforce more 'flexible' you can slowly get them down to parity with mexico etc. Temp workforce is one of the great ways this is currently being accomplished. 

And since someone may chime in with "but automation!!!" Yes, automation is coming no matter what, and it has nothing to do with labour prices. No matter how much you charge (including nothing) you will never be more effective at performing the identical tasks as my $20 calculator or any number of 'free' online ones. This is how it will be for most jobs at some point..

This is all outside of the clusterfuck financial meltodwn in 2008. 

FreedomGuy's picture

High risk is expensive, low risk is less expensive. That is the market.

The question is how much real labor costs in America versus Bangladesh and what value they can provide at what cost. If your method of production and labor can only produce $10/hr of labor then you cannot pay $15, plus benefits, plus regulatory costs plus taxes. Bangladesh has to be not just a little cheaper but a whole lot cheaper because the materials have to be put in containers, thru docks, on ships, across oceans, off ships, back thru docks and onto trains and trucks. This would include tariffs and import quotas, as well. Made in the USA or locally requires pretty much only trucks and trains and no tarrifs. Local labor starts with many advantages, not to mention language, property rights, etc. This is why foreign workers have to be really cheap in order to compete. Even China is now losing out to others in the low cost production world.

The 2008 meltdown was a financial, Fed and government policy induced meltdown. Our long term production problems are government problems by and large.

James_Cole's picture

Bangladesh has to be not just a little cheaper but a whole lot cheaper because the materials have to be put in containers, thru docks, on ships, across oceans, off ships, back thru docks and onto trains and trucks. This would include tariffs and import quotas, as well.

In the abstract I'm sure this is persuasive, but looking at specific cases it's a lot more complex. Look at auto manufacturing for instance. In Germany auto workers take home hrly ~67.00$ in US&A ~33.00$ in Mexico ~$4.00. The same companies who got bailed out by uncle sam are now investing heavily in mexico.

Anyone claiming that auto (and lots of other) manufacturing has been moved to mexico not because of the low labour costs (which are supposedly largely nullified by the various factors you supply - interestingly US has another trade agreement on the horizon to deal with the tariffs you seem to hold in high regard) but because uncle sam has been up to too much regulation fuckery and can no longer compete... well, the facts don't add up.  

GM said last week that it will invest $691 million to boost its Mexican assembly lines.

To some, particularly the United Auto Workers union and many of its 1 million active and retired members, the trend confirms dire predictions of U.S. industrial decline brought on by the 1994 North American Free Trade Agreement. Although U.S. assembly lines have recovered some jobs since the federal bailout, the industry’s long-term labor pull is southward to Mexico, where organized labor is feeble and rock-bottom wages are the rule.

Michigan-based parts giant Delphi isone of Mexico’s largest private employers, with more than 50 plants and 50,000 employees.

The Big Three are stronger and more competitive globally because they locate some production in Mexico and source parts from there as well, he said.

Lol, guess that's the secret sauce behind daimler ag as well!


Interesting read, an article highly critical of where Germany is moving with its labour reforms. Somewhat comical when compared with US&A.


Colonel Walter E Kurtz's picture

James..yes, it is the regulations more than you know.

Have you tried paying about 20-30 cents on the dollar utilizing employees, because that is what it roughly costs in order to comply with the regulations (and taxes) and still try to compete against individuals/businesses those that do not care about our laws and regulations? Until you do, you will not understand the mess the government behemoth has created. They have made those paying the freight, the middle class workers and small businesses, non-competitive against those that scoff at the laws/regulations they create. This would be the cash workers, illegal workers, mis-classified workers and overseas manufacturers. And what do you think the government' solution is...of course, more freaking laws! 




Vampyroteuthis infernalis's picture

I worked as a temp (well paid one) for 3 years. Not knowing if you have a job the next day is nerve racking. The day I quit my boss' look on his face is one not to be forgotten. I thought you were going to stick it out till I hire you full time. Yeah, you told me that well over two years ago jackass.

PT's picture

There comes a time where you have no choice but to leave.  And once you leave, you'll wonder why you waited so long and didn't do it sooner.

Okienomics's picture

I left my last "job" in 2010 and have no desire ever to return.  My income is up, my time is mine and my office is down the hall from my bedroom.  Life is rich and full and the notion that the 53 million (or so) "temp" workers are a sign that things are terrible may also be a departure from reality.  If anything, I'd posit that a class of independent contractors makes for a happier, healthier and, in my case at least, more productive work force.

Chump's picture

Agreed in theory.  Unfortunately too many are tied to a mortgage and lack mobility.

California Nightmares's picture

Curious thing....

Has anyone else noticed how sweet the cashiers now are at McDonald's. Starbucks... everywhere you shop?

I can imagine the boss telling the part timers, "You wanna keep this job, you gotta kiss the customers' asses and kiss 'em good! And SMILE!"

Employees sense how easily they can be replaced by others more eager.


TeethVillage88s's picture

Are we there Yet??

Global Thermonuclear War, Continental Epidemic, OR Nationwide Enslavement? Debt is Good, Debt is Money, Derivatives don't require regulation and are stimulative to the Great Economy. /S

pgroup's picture

Or you could find something other than the leftist endevours you listed. Join a tea party. Volunteer to answer the phone for an election campaign. Volunteer to watch ballot counting. Adopt a mile of highway to clean up (bonus - you get your name on a sign). Find a disabled person and mow his/her lawn for free.

Or enjoy your time on the couch because it sure as hell ain't gonna last much longer. Your choice.

BandGap's picture

My last three contracts for Permanent positions were written such that I can be terminated without cause, anytime. I think the rules for "temps" and "permanent" have coalesced. In fact, a job I had two years ago let a dozen Mangers/Directors/VPs go in a cost saving move in the matter of two weeks. All legit.

It's not the classification, it's the shift in how businesses are looking at things these days - survival mode.

TVP's picture

All jobs now require you to sign something saying you understand that you can be fired at any moment for no reason at all.

This is the "new normal"....the next "normal" will be slave labor camps, where anyone can be put to death at any moment for no reason at all.  

Oh wait, NDAA 2012...

Skateboarder's picture

Employment at will means you as the employee can up and leave wihtout saying anything either.

Not saying the "you can be fired at any moment" deal is acceptable, but there is your side of the coin, as well as theirs, not that it helps you at all as an employee tryna make some dough and make it to the next day lol.

PrecipiceWatching's picture


Property rights.

As an employer, I would love to be able to fire my employees without cause.  They can certainly leave me without gving me a reason or notice.

Businesses do not "owe" employees a job, or for that matter vacations, paid time off, or health care benefits.


That said, treat me good and I will reciprocate twice over.


corporatewhore's picture

Some people actually still seal the deal with a handshake and honor their word without all the 50 page legalese and mbaese.  If you have one of those for an employee keep him/her happy and if you don't know how to do that do some research.

PrecipiceWatching's picture

I certainly know how to keep my employees happy.


And it doesn't require any help from the government or, for that matter, anyone else.

pgroup's picture

Rush Limbaugh pays his employees more than twice what the job is worth on the market. He says he does this because he hates having to hire people just because somebody else offers more pay. Plus, he says he wants to ensure that they are always ready and always at the top of their game for their particular job.

Having substantial wealth certainly allows some annoyances of life to be bought off and nevermore to be annoying.

Dadzrites's picture

Then employees shouldn't have to give any employer 2 weeks notice and then be denigrated to the next employer for not giving the notice when the employee seeks a new position.

PT's picture

On the plus side, when my income became unreliable I stopped borrowing (not that I borrowed much in the first place but I had plans). 

How's that "consumer confidence" thing working out?  From my limited understanding, I believe that most people spend nearly every cent that they earn and so "consumer confidence" must have something to do with how much people are planning on borrowing.  Normal people don't borrow when they have no idea how to repay, i.e. no reliable income.  Then again, I guess the banks don't care.  As long as they can sell overpriced shares and real estate to each other, they can keep the Ponzi going.

LawsofPhysics's picture

there you go, keep dancing...

RaceToTheBottom's picture

Yep, we are all "temporary workers" when you get right down to it.  Workplace security is a thing of the past.

Here today, gone tomorrow.

Headbanger's picture

Yeah no shit to this fucking idiotic article cause the days of having a career with the same company with full benefits has been long gone for a long time now!

Cause the fact is there's no longer the need for workers as there was when the Communist nations were essentially cut off from the global economy just like North Korea is still today.

There's too many people and no need for their labor plain and simple

Which is why TPTB are brewing up a real world war right now to reduce population.

And so good luck!

Al Huxley's picture

Those days by and large ended back in the late 80s.  I remember because I was just starting work then and saw the writing on the wall pretty clearly at the large company I'd been recruited into.  Concurrent with the 'new hire, career path training' I was going through, the company was in the process of acquiring a major competitor, primarily because that competitor had 'a much more lean-and-mean culture, less commitment to long-term employee development and more focus on short-term bottom line'.  I got out of there around the same time, about a year later the first big round of layoffs (in company history) happened.  They're now down to about 1/4 of the workforce they had when I started (but super-profitable - major win for shareholders and executives).

Chupacabra-322's picture

Under President Obama, the richest 10 percent were the only income group of Americans to see their median incomes rise, according to a survey released this week by the Federal Reserve.

The Fed data covered the years 2010-2013, during which period Mr. Obama constantly campaigned against income inequality and won re-election by painting his Republican rival as a tool of Wall Street plutocrats.

“Data from the 2013 [Survey of Consumer Finances] confirm that the shares of income and wealth held by affluent families are at modern historically high levels,” the report said in noting that the median income fell for every 10-percent grouping except the most affluent 10 percent.


FreedomGuy's picture

There are a lot of factors to the downturn in prospective employment and economic distributions.

In a controlled, centrally planned, leftist economy things predictably end up just where they are now. This is the classic stagflation scenario. The only two classes of people that prosper are the very bottom with guaranteed government minimums and no work requirements and those at the top who can maximize return and negotiate or absorb the costs of ever more rules.

Also, in the centrally planned financial world and artificially cheap money, it is easier, less risky and more profitable to play with cash. This favors the wealthy. Making stuff is expensive, risky and fraught with legal peril. This is why it is easier, quicker and less risky to just engage in mass layoffs than take a chance with a new product or build a new product line to see if you can sell more units, especially in the face of projected flat demand.

Last, if you are dumb enough to try and make things then you want to do it overseas. Fewer rules. Fewer enviro lawsuits. Lower taxes and labor forces that appreciate you more. Look, hamburger flippers say you are an asshole if you don't give them $15/hr and a company car right now. Workers in Malaysia will be happy for work and anything less than a 60 hr work week. Even though you might make fun of their low wages, they actually can make a living in the correspondingly low cost country. It is better to trade derivatives or engage in robo-HFT here. You need supercomputers and guys in $2500.00 suits for that, but only a few.

Welcome to Amerika. The central planners do in fact have a plan for you...and it may not be optional for much longer.

CheapBastard's picture

That's just one more reason NOT to buy a house and tie yourself down with lead weights around your ankles. My neighbor's two sons have bounced around the country from job to better job at least 4 times. One is now off to HK for a better paying job. If they had made the disastrous choice of buying one of those no-money-down adjustable rate mortgage boxes I would never hear the end of their father's complaints from next door. 


Kids are smarter now, well, at least some. Many graduates who are out there in "the real world" see the crappy economy which MSM fails to see. It's a new world and those kids who undertand it will survive better off then those who fall for the MSM propaganda.

FreedomGuy's picture

Your point about housing is good and I swore I would not buy another after two layoffs and moves. However, rents rise in a weak economy and my rent was rising rapidly and not tax deductible. So, I bought a condo to live in. It fixes my costs and offers some tax break. I am still not certain it was a great idea but there is a rationale for it.

JuliaS's picture

The class structure of the future world is the government, the robot-maker and factory operator, the data collector and processor, the accountant (ie. the banker). There is no need for what constitutes the middle class. The middle between what and what? A person starting where and on his way where? No middle class in the highly automated and euqally corrupt future. Just machines and data working tirelessly to satisfy the demans of a tiny elite - a fraction even of the 1% that exists today.

A way there? A slow natural depopulation if the people are willing and complacent, or a rapid and violent one via war if they put up a fight.

The only thing that might alter the course, in my opinion, is a catastrophic event that curbs the use of technology. A massive solar flare, a nuclear EMP blast or something equally devastating that manages to wipe out ages of accumulated data existing only in digital form. However, such world will still be worse than the technological pseudo-utopia.

Another option is that we rapidly deplete finite energy resources, and while thinking machiens will still be in high demand, the muscle power will once again become a viable form of labor. Again, unlikely, but what other solutions are out there? Population reduction is coming. The reason we have that many people in first place is because in an industrial society having the most working hands and the biggest army meant being a winner. More people meant better life. In the future world of diminishing returns having fewer mouths to feed will result in higher quality of life. So an exact opposite will be true. Unfortunately, none of us in the ZH club belong to the category that will benefit from the transition. We're the expendables.

fallout11's picture

Superb post JuliaS, and spot on I fear.