Human Resources News & Insights

Will full-time employees soon be a thing of the past?

The permanent, 40-hour-a-week staffer is going the way of the dinosaur, according to guest poster Jeff Russell.   

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Full-time workforce trends are on the decline. By 2020, somewhere between 40 to 50% of the American workforce will be contingent or part-time employees. This is according to a lot of projections I’ve been seeing lately by certified smart folks in our industry.  

The days of guaranteed lifetime work are going the way of Detroit. For workers this can be both good and bad. The good is that workers will be more valued for what they can contribute and therefore, highly sought-after skills will demand a premium. It will be less about who you are/who you know/how long you’ve been on the job than it will be about what important skills you can offer today.

The bad news: Workers will have to keep their skills and judgment polished to a mirror finish.

‘Perfect storm’ hits traditional job model

We’re also seeing more and more work that’s project-based. An employee’s hired for a specific project, the project is over and so is the job — unless the firm’s obtained a new project. Even then, employees better perform and have a great work ethic, or employers will just move on. 

A lot of forces are coming to bear against the traditional model of companies filled with full-time, salaried employees. Telecommuting and the rise of global commerce are wiping out cubicles and the 9-to-5 workday. (This is especially true for Millennials, who tend to resist the strictures of “office hours” and are more interested in meaningful, exciting work than in the benefits and retirement packages that come with a permanent full time job.)

Another pressure bearing down against full-time workers is the fact that many government regulations, most notably Obamacare, apply only to full time workers. These are variously defined under the different laws as those working at least 30 to 40 hours per week for a single employer.

Taking advantage of these trends, organizations will increasingly prefer to hire independent contractors or part time workers. As the McKinsey Global Institute puts it, “Technology makes it possible for companies to manage labor as a variable input.”

What about benefits?

A huge question mark: What about benefits? Will the new worker economy mean that more and more employees won’t have company-provided benefits? Will everyone become an independent contractor? As I discussed in a previous post, this could have major impacts on the way employees are treated and the design of new forms of “employment policies.”

Our friends in Washington don’t seem to understand that businesses are smart and will figure out ways to keep costs down – temp, part-time, and project workers are one way.  We compete in a world economy, not state or national. Better get smart and stay smart. For companies a lot of their success will depend upon how well they’re able to attract workers with cutting edge skills. Also, employees are going to be more and more responsible for their own training.

The public sector isn’t immune either. Guaranteed public jobs with great benefits are on their way out. The unions are dying.  Governments at all levels have overpromised and now can’t deliver.  Detroit is again a prime example. My guess is that the trend will accelerate, and we’ll see smaller government workforces — with the possible exception of Washington, DC — but then again, they can print money.

Jeff Russell is CEO of GeniusHR, a firm that develops business process automation systems that maximize efficiency for HR.

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  • MMAN

    Good one garrafa10. You hit the nail on the head. If we continue this trend…all the great things of America will disappear and we will be one of the first countries to become a third world country in a backwards sense.

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