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U.S. Department of Labor Futurework
  Trends and Challenges for Work in the 21st Century
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Flexible Staffing Arrangements

A Report on Temporary Help, On-Call, Direct-Hire Temporary, Leased, Contract Company, and Independent Contractor Employment in the United States

Susan N. Houseman
August 1999

8. Why Firms Use Flexible Staffing Arrangements

Several employer surveys have been conducted on the use of flexible staffing arrangements. These surveys provide evidence on why firms use flexible staffing arrangements and why firms have been increasing their use of certain types of staffing arrangements in recent years. One of the earliest such surveys, conducted in 1981, investigated firms' use of agency temporaries, direct-hire temporaries, and on-call workers in six broad sectors (Mangum, Mayall, and Nelson 1985). The Conference Board and the Bureau of National Affairs have conducted surveys of their members, who are generally large and sometimes foreign-based companies, on their use of flexible staffing arrangements (Abraham 1988, 1990, Bureau of National Affairs 1994 and Conference Board 1995). Small-scale surveys of large corporations have been conducted by Christensen (1995) and Kahn (1996). Recently, two large-scale surveys have been conducted on nationally representative samples of employers on their use of flexible staffing arrangements: a survey of 550 employers sponsored by the Upjohn Institute for Employment Research in 1996 (Houseman 1997) and a survey of 1000 employers sponsored by the National Science Foundation (Kalleberg, Reynolds, and Marsden 1999). In addition to employer surveys, several researchers have conducted firm or industry case studies, which shed light on employers' motivations for using flexible staffing arrangements.

Collectively, this research has identified several key factors behind employers' use of flexible staffing arrangements, including fluctuations in their staffing needs, savings on wage and benefit costs, screening workers for permanent positions, and accessing special skills.

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