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What Do We Know about Contracting Out in the United States? Evidence from Household and Establishment Surveys

In: Labor in the New Economy

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Abstract

A variety of evidence points to significant growth in domestic contracting out over the last two decades, yet the phenomenon is not well documented. In this paper, we pull together data from various sources to shed light on the extent of and trends in domestic outsourcing, the occupations in which it has grown, and the industries engaging in outsourcing for the employment services sector, which has been a particularly important area of domestic outsourcing. In addition, we examine evidence of contracting out of selected occupations to other sectors. We point to many gaps in our knowledge on trends in domestic outsourcing and its implications for employment patterns and to inconsistencies across data sets in the information that is available. We recommend steps to improve data in this area.
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Suggested Citation

  • Matthew Dey & Susan N. Houseman & Anne Polivka, 2010. "What Do We Know about Contracting Out in the United States? Evidence from Household and Establishment Surveys," Book chapters authored by Upjohn Institute researchers, in: Katharine G. Abraham & James R. Spletzer & Michael J. Harper (ed.),Labor in the New Economy, pages 267-304, W.E. Upjohn Institute for Employment Research.
    • Handle: RePEc:upj:uchaps:snhchicago
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    19. George Erickcek & Susan Houseman & Arne Kalleberg, 2002. "The Effects of Temporary Services and Contracting Out on Low-Skilled Workers: Evidence from Auto Suppliers, Hospitals, and Public Schools," Upjohn Working Papers 03-90, W.E. Upjohn Institute for Employment Research.
    20. Susan N. Houseman & Anne E. Polivka, 1999. "The Implications of Flexible Staffing Arrangements for Job Stability," Upjohn Working Papers 99-56, W.E. Upjohn Institute for Employment Research.
    21. Bartel, Ann & Lach, Saul & Sicherman, Nachum, 2005. "Outsourcing and Technological Change," CEPR Discussion Papers 5082, C.E.P.R. Discussion Papers.
    22. Susan N. Houseman & Arne L. Kalleberg & George A. Erickcek, 2001. "The Role of Temporary Help Employment in Tight Labor Markets," Upjohn Working Papers 01-73, W.E. Upjohn Institute for Employment Research.
    23. George A. Erickcek & Susan N. Houseman & Arne L. Kalleberg, 2003. "The Effects of Temporary Services and Contracting Out on Low-Skilled Workers: Evidence from Auto Suppliers, Hospitals, and Public Schools," Book chapters authored by Upjohn Institute researchers, in: Eileen Appelbaum & Annette Bernhardt & Richard J. Murnane (ed.),Low-Wage America: How Employers Are Reshaping Opportunity in the Workplace, pages 368-403, W.E. Upjohn Institute for Employment Research.
    24. Lewis M. Segal & Daniel G. Sullivan, 1995. "The temporary labor force," Economic Perspectives, Federal Reserve Bank of Chicago, vol. 19(Mar), pages 2-19.
    25. Matthew Dey & Susan Houseman & Anne Polivka, 2006. "Manufacturers' Outsourcing to Employment Services," Upjohn Working Papers 07-132, W.E. Upjohn Institute for Employment Research.
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    Cited by:

    1. Haltiwanger, John C. & Spletzer, James R., 2020. "Between Firm Changes in Earnings Inequality: The Dominant Role of Industry Effects," IZA Discussion Papers 12990, Institute of Labor Economics (IZA).
    2. Haltiwanger, John C. & Hyatt, Henry R. & Spletzer, James R., 2022. "Industries, Mega Firms, and Increasing Inequality," IZA Discussion Papers 15197, Institute of Labor Economics (IZA).
    3. Deborah Goldschmidt & Johannes F. Schmieder, 2017. "The Rise of Domestic Outsourcing and the Evolution of the German Wage Structure," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 132(3), pages 1165-1217.
    4. James Spletzer & Elizabeth Weber Handwerker, 2015. "The Role of Establishments and the Concentration of Occupations in Wage Inequality," Working Papers id:7427, eSocialSciences.
    5. Alexandre Mas & Amanda Pallais, 2020. "Alternative Work Arrangements," Annual Review of Economics, Annual Reviews, vol. 12(1), pages 631-658, August.
    6. Paul Osterman, 2022. "How American Adults Obtain Work Skills: Results of a New National Survey," ILR Review, Cornell University, ILR School, vol. 75(3), pages 578-607, May.
    7. Bernhardt, Annette & Batt, Rosemary & Houseman, Susan & Appelbaum, Eileen, 2016. "Domestic Outsourcing in the U.S.: A Research Agenda to Assess Trends and Effects on Job Quality," Institute for Research on Labor and Employment, Working Paper Series qt2fm4m444, Institute of Industrial Relations, UC Berkeley.
    8. Henry Hyatt & James Spletzer, 2013. "The recent decline in employment dynamics," IZA Journal of Labor Economics, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 2(1), pages 1-21, December.
    9. Zimmerman, Paul R., 2010. "Deterrence from self-protection measures in the ‘market model’ of crime: dynamic panel data estimates from employment in private security occupations," MPRA Paper 26187, University Library of Munich, Germany.
    10. Annette Bernhardt & Rosemary L. Batt & Susan Houseman & Eileen Appelbaum, 2016. "Domestic Outsourcing in the United States: A Research Agenda to Assess Trends and Effects on Job Quality," Upjohn Working Papers 16-253, W.E. Upjohn Institute for Employment Research.
    11. Hammerling, Jessie HF, 2022. "Trends in Inter-Firm Transactions Across Industries in the U.S," Institute for Research on Labor and Employment, Working Paper Series qt9dr868wx, Institute of Industrial Relations, UC Berkeley.
    12. Annette Bernhardt & Michael W. Spiller & Nik Theodore, 2013. "Employers Gone Rogue: Explaining Industry Variation in Violations of Workplace Laws," ILR Review, Cornell University, ILR School, vol. 66(4), pages 808-832, July.
    13. Bernhardt, Annette, 2014. "Labor Standards and the Reorganization of Work: Gaps in Data and Research," Institute for Research on Labor and Employment, Working Paper Series qt3hc6t3d5, Institute of Industrial Relations, UC Berkeley.
    14. Annette Bernhardt & Rosemary Batt & Susan Houseman & Eileen Appelbaum, 2016. "Working Paper: Domestic Outsourcing in the United States: A Research Agenda to Assess Trends and Effects on Job Quality," CEPR Reports and Issue Briefs 2016-03, Center for Economic and Policy Research (CEPR).
    15. N/A, 2013. "Introduction to the Special Issue on Job Quality: What Does it Mean and How Might We Think about It?," ILR Review, Cornell University, ILR School, vol. 66(4), pages 739-752, July.
    16. Zimmerman, Paul R., 2014. "The deterrence of crime through private security efforts: Theory and evidence," International Review of Law and Economics, Elsevier, vol. 37(C), pages 66-75.

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    More about this item

    Keywords

    nonstandard work; contacting out;

    JEL classification:

    • J2 - Labor and Demographic Economics - - Demand and Supply of Labor

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