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The Role of Temporary Help Employment in Low-Wage Worker Advancement

In: Studies of Labor Market Intermediation

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  • Carolyn J. Heinrich
  • Peter R. Mueser
  • Kenneth R. Troske

Abstract

We examine the effects of temporary help service employment on later earnings and employment for individuals participating in three federal programs providing supportive services to those facing employment difficulties. The programs include Temporary Assistance for Needy Families, whose participants are seriously disadvantaged; a job training program with a highly heterogeneous population of participants; and employment exchange services, whose participants consist of Unemployment Insurance claimants and individuals seeking assistant in obtaining employment. We undertake our analyses for two periods: the late 1990s, a time of very strong economic growth, and shortly after 2000, a time of relative stagnation. Our results suggest that temporary help service firms may facilitate quicker access to jobs for those seeking employment assistance and impart substantial benefits as transitional employment, especially for individuals whose alternatives are severely limited. Those who do not move out of temporary help jobs, however, face substantially poorer prospects, and we observe that nonwhites are more likely than whites to remain in THS positions in the two years following program participation. Our results are robust to program and time period.

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This chapter was published in:

  • David H. Autor, 2009. "Studies of Labor Market Intermediation," NBER Books, National Bureau of Economic Research, Inc, number auto07-1.
    This item is provided by National Bureau of Economic Research, Inc in its series NBER Chapters with number 3596.

    Handle: RePEc:nbr:nberch:3596

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    1. Fredrik Andersson & Harry J. Holzer & Julia Lane, 2007. "Temporary Help Agencies and the Advancement Prospects of Low Earners," NBER Working Papers 13434, National Bureau of Economic Research, Inc.
    2. Julia Lane & Kelly S. Mikelson & Pat Sharkey & Doug Wissoker, 2003. "Pathways to work for low-income workers: The effect of work in the temporary help industry," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 22(4), pages 581-598.
    3. Orley Ashenfelter & David Card, 1984. "Using the Longitudinal Structure of Earnings to Estimate the Effect of Training Programs," Working Papers 554, Princeton University, Department of Economics, Industrial Relations Section..
    4. Heinrich, Carolyn J. & Mueser, Peter R. & Troske, Kenneth, 2002. "Welfare to Temporary Work: Implications for Labor Market Outcomes," IZA Discussion Papers 584, Institute for the Study of Labor (IZA).
    5. Lewis Segal & Daniel Sullivan, 1996. "The growth of temporary services work," Working Paper Series, Macroeconomic Issues WP-96-26, Federal Reserve Bank of Chicago.
    6. Andrew Dyke & Carolyn J. Heinrich & Peter R. Mueser & Kenneth R. Troske & Kyung-Seong Jeon, 2006. "The Effects of Welfare-to-Work Program Activities on Labor Market Outcomes," Journal of Labor Economics, University of Chicago Press, vol. 24(3), pages 567-608, July.
    7. Antoni, Manfred & Jahn, Elke J., 2006. "Do Changes in Regulation Affect Employment Duration in Temporary Work Agencies?," IZA Discussion Papers 2343, Institute for the Study of Labor (IZA).
    8. William E. Even & David A. Macpherson, 2004. "The Wage and Employment Dynamics of Minimum Wage Workers," Labor and Demography 0404007, EconWPA.
    9. Booth, Alison L. & Francesconi, Marco & Frank, Jeff, 2000. "Temporary Jobs: Stepping Stones or Dead Ends?," IZA Discussion Papers 205, Institute for the Study of Labor (IZA).
    10. Michael Kvasnicka, 2005. "Does Temporary Agency Work Provide a Stepping Stone to Regular Employment?," Labor and Demography 0510005, EconWPA.
    11. Gagliarducci, Stefano, 2005. "The dynamics of repeated temporary jobs," Labour Economics, Elsevier, vol. 12(4), pages 429-448, August.
    12. J. Ignacio García-Pérez & Fernando Muñoz-Bullón, 2005. "Temporary Help Agencies and Occupational Mobility," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 67(2), pages 163-180, 04.
    13. Heckman, James J. & Lalonde, Robert J. & Smith, Jeffrey A., 1999. "The economics and econometrics of active labor market programs," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 31, pages 1865-2097 Elsevier.
    14. Carolyn J. Heinrich, 2005. "Temporary Employment Experiences of Women on Welfare," Journal of Labor Research, Transaction Publishers, vol. 26(2), pages 335-350, January.
    15. David H. Autor & Susan Houseman, 2005. "Do Temporary Help Jobs Improve Labor Market Outcomes for Low-Skilled Workers? Evidence from 'Work First'," NBER Working Papers 11743, National Bureau of Economic Research, Inc.
    16. Susan N. Houseman & Arne L. Kalleberg & George A. Erickcek, . "The Role of Temporary Agency Employment in Tight Labor Markets," Upjohn Working Papers and Journal Articles snhakge2003, W.E. Upjohn Institute for Employment Research.
    17. Joseph G. Altonji & Todd E. Elder & Christopher R. Taber, 2005. "Selection on Observed and Unobserved Variables: Assessing the Effectiveness of Catholic Schools," Journal of Political Economy, University of Chicago Press, vol. 113(1), pages 151-184, February.
    18. Peter R. Mueser & Kenneth R. Troske & Carolyn J. Heinrich, 2007. "The Role of Temporary Help Employment in Low-wage Worker Advancement," Working Papers 0719, Department of Economics, University of Missouri.
    19. V. Joseph Hotz & Guido W. Imbens & Jacob A. Klerman, 2006. "Evaluating the Differential Effects of Alternative Welfare-to-Work Training Components: A Re-Analysis of the California GAIN Program," NBER Working Papers 11939, National Bureau of Economic Research, Inc.
    20. Susan N. Houseman & Anne E. Polivka, 1999. "The Implications of Flexible Staffing Arrangements for Job Stability," Upjohn Working Papers and Journal Articles 99-56, W.E. Upjohn Institute for Employment Research.
    21. Susan N. Houseman & Arne L. Kalleberg & George A. Erickcek, 2003. "The role of temporary agency employment in tight labor markets," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 57(1), pages 105-127, October.
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    Cited by:
    1. Hinrichs, Peter, 2011. "The effects of attending a diverse college," Economics of Education Review, Elsevier, vol. 30(2), pages 332-341, April.
    2. Peter R. Mueser & Kenneth R. Troske & Carolyn J. Heinrich, 2007. "The Role of Temporary Help Employment in Low-wage Worker Advancement," Working Papers 0719, Department of Economics, University of Missouri.
    3. Cockx, Bart & Picchio, Matteo, 2009. "Are Short-Lived Jobs Stepping Stones to Long-Lasting Jobs?," IZA Discussion Papers 4007, Institute for the Study of Labor (IZA).
    4. Jahn, Elke J. & Rosholm, Michael, 2014. "Looking beyond the bridge: The effect of temporary agency employment on labor market outcomes," European Economic Review, Elsevier, vol. 65(C), pages 108-125.
    5. Christopher L. House & Jing Zhang, 2012. "Layoffs, Lemons and Temps," NBER Working Papers 17962, National Bureau of Economic Research, Inc.
    6. Jahn, Elke J. & Rosholm, Michael, 2010. "Looking Beyond the Bridge: How Temporary Agency Employment Affects Labor Market Outcomes," IZA Discussion Papers 4973, Institute for the Study of Labor (IZA).
    7. Okudaira, Hiroko & Ohtake, Fumio & Kume, Koichi & Tsuru, Kotaro, 2013. "What does a temporary help service job offer? Empirical suggestions from a Japanese survey," Journal of the Japanese and International Economies, Elsevier, vol. 28(C), pages 37-68.
    8. Bruno, Giovanni S. F. & Caroleo, Floro Ernesto & Dessy, Orietta, 2012. "Stepping Stones versus Dead End Jobs: Exits from Temporary Contracts in Italy after the 2003 Reform," IZA Discussion Papers 6746, Institute for the Study of Labor (IZA).
    9. Andersson Joona, Pernilla & Wadensjö, Eskil, 2012. "A Price for Flexibility? The Temp Agency Wage Gap in Sweden 1998-2008," IZA Discussion Papers 6587, Institute for the Study of Labor (IZA).
    10. Eichhorst, Werner & Kendzia, Michael J. & al., et, 2013. "Report No. 57: The Role and Activities of Employment Agencies," IZA Research Reports 57, Institute for the Study of Labor (IZA).

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