Temporary Work is Bad for Your Cognitive Health

Yves here. The findings of this study on the effects of temporary work on individuals’ skills has important ramifications for the US, where short-term contracting is even more common than in Europe. The first is that workers are harmed by this practice, and not just via stress or having uncertain income. But second is that employers over time also suffer by degrading the capabilities of the labor pool.

By Antonio Cabrales, Juan Dolado, and Ricardo Mora. Originally published at VoxEU

The negative consequences of dual labour markets have been extensively documented, but so far little attention has been paid to their effects on workers’ on-the-job training and cognitive skills. This column discusses evidence from PIAAC – an exam for adults designed by the OECD in 2013. Temporary contracts are associated with a reduction of 8–16 percentage points in the probability of receiving on-the-job training, and this training gap can explain up to half of the gap in numeracy scores between permanent and temporary workers.

Starting with the seminal work by Saint-Paul (1996), there has been a large literature documenting the negative consequences of dual labour markets in several EU countries.1 Among them, Spain is often cited as the most extreme example, since its labour market is characterised by a large gap between the firing costs of workers with permanent and temporary contracts, and by lax regulation of the use of temporary contracts. Yet, so far not much attention has been paid to the effects of dual labour markets on workers’ on-the-job training (OJT) and the subsequent effect of the latter on cognitive skills.2 A new element to add to the ample evidence of the negative effects of duality on other dimensions of worker’s performance is provided by the Programme for the International Assessment of Adult Competencies (PIAAC), the exam for adults designed by the OECD in 2013, in the spirit of the PISA exams but for the working-age population.

Employment Protection Legislation and On-the-Job Training

In a recent paper (Cabrales et al. 2014), we present evidence suggesting that (everything else equal) workers under temporary contracts receive less employer-sponsored training than workers under permanent contracts and that, through this channel, labour market dualism also reduces the cognitive abilities of the former relative to the latter. One plausible mechanism leading to the gap in on-the-job training relies on the large turnover rate among temporary workers, which is induced by the much less stringent employment protection legislation they enjoy relative to permanent workers. Given this differential, whenever collective bargaining prevents neutralising severance pay (i.e. a transfer from employers to workers) through enough wage flexibility, firms will prefer to use temporary contracts in sequence rather than converting them into permanent contracts. As a result, the expected job duration of temporary workers becomes too short, making firms more reluctant to invest in their training. By contrast, the much stronger employment protection enjoyed by permanent workers increases their expected job duration, making firms more eager to invest in them. Thus, in countries with large employment protection gaps and wage rigidity, temporary contracts become dead-end jobs rather than stepping stones, as is often the case in those other countries where employment protection gaps are lower.

Spain is an interesting case study because, since the early 1990s, it has had a large share of temporary work among employees – around 33%. Even after the massive destruction of temporary jobs (almost 2 million) and the mild reduction in the employment protection gap after the labour market reform in 2012, it has fallen only to 24% – still one of the highest rates in the OECD.

In our paper, we provide evidence that differences in employment protection legislation between permanent and temporary contracts is related to differences in on-the-job training within the firm. We also analyse how training can be connected with the cognitive skills (numeracy and literacy) of these workers. Since education is one of the key determinants of the growth rate of total factor productivity, our results suggest a connection between a poor performance in terms of TFP growth and the excessive use of temporary contracts.

Evidence from PIAAC Tests

Individuals participating in PIAAC are aged between 15 and 65 years. We look at those who are salaried employees and answered the full questionnaire. The main treatment variable is whether the worker has a temporary contract (more specifically, a fixed-term contract, temporary work with an employment agency, or any kind of training contract) or not. The main outcome variable is the availability of on-the-job training. This binary variable, denoted by DOJT, takes the value 1 if the worker claims to have attended a training session organised or given by their supervisors or co-workers in the past 12 months. According to the PIAAC guidelines, these activities are characterised as planned periods of training, instruction, or practical experience designed to help the respondent do his/her job better or get familiarised with his/her new tasks.

Controlling for Workers’ Motivation

We control for those observable factors in the sample that could potentially affect both the above-mentioned outcome and the treatment variable. Controls can be divided into two types. First, we use basic individual characteristics, such as age, gender, education level, marital status, whether there are children in the household, immigrant status, and the level of education of their parents. Second, we control for occupation (two digits) and industry (one digit) dummy variables. The PIAAC data also include information that is usually absent in this type of analysis and whose absence can seriously bias the results – the worker’s motivation. To capture this information, we exploit a question on the reasons for learning new skills. In particular, we use a dummy variable, Motivation, which takes the value 1 when the individual reports being identified ‘largely’ or ‘to a very great extent’ with learning new skills to improve her performance in the workplace. Notice that not controlling for individual motivation may provide a non-causal correlation between temporary contracts and skills acquisition, as less motivated individuals may also be more likely to have a temporary contract.

Empirical Findings

  • Depending on the specification, we find that a temporary contract is associated with a reduction of between 8 and 16 percentage points in the probability of receiving on-the-job training (the unconditional probability of receiving training in our sample is 44%).3

These results are consistent with the view that entrepreneurs do not find it profitable to train workers who will be fired with high probability at the end of their contracts, as the still-high differential in severance payments between permanent and temporary contracts is for them an insurmountable obstacle (the annual temporary-to-permanent conversion rate in Spain barely exceeds 7% at present, and never went above 15% in the past).

We then turn to the association between cognitive skills and having received training in the company, again for various specifications. In the case of numeracy scores, the relationship is positive and quite robust.4

  • The difference in PIAAC test results between workers with permanent and temporary contracts was 14 points (261 and 247, respectively), and our results indicate that between 4 and 7 points of this gap is explained directly by the lower occupational training received by temporary workers.

These results remain fairly similar when we carry out several robustness checks. For example, this is the case when we use propensity score matching techniques to minimise the differences between the treatment and control groups, besides having a temporary contract, or when we use a restricted control group corresponding to those employees who had the possibility to attend employer-sponsored training but ended up not doing so for exceptional and unexpected reasons.

Finally, we provide evidence for other EU countries.5

  • In relatively dual labour markets (Italy, France) workers receive less training than in countries with more unified labour markets (Denmark, UK).

Furthermore, differences in cognitive abilities between permanent and temporary workers are strong in dual countries while they are insignificant in less dual countries.

Concluding Remarks

The evidence presented above is not, strictly speaking, a ‘smoking gun’ of a harmful effect of temporary contracts. Due to the nature of our data (a cross section), we cannot credibly establish unambiguous causality for the statistical relation that we find. However, the evidence is quite suggestive. We hope that future analysis will allow for a clearer causal inference, but given all the evidence (not just ours) accumulated so far on the detrimental effects of dualism, we should keep the suspect under house arrest and heavy police surveillance. If it really is a social danger, we should at least try not to do more damage.

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  1. Moneta

    Unless it’s for a very particular kind of job…
    -Lack of commitment on both sides
    -Lack of trust on both sides
    Probably the 2 most important elements for mid to long-term business success.

    1. jrs

      Has anyone here ever received on the job training even in jobs that lasted years? Oh probably a boomer back in the days then? Because training is rare these days. Management and so on are sometimes sent to training – it’s a function of hierarchy of course. Of course things might be different in the EU.

      1. Alcofribas

        Not at all. Inequalities of training curves follow exactly inequalities of salary and robustness/precarity of jobs. One only grants rich ones. It’s a systemic faithful rule of liberalism, and so worldwide applying.

      2. James

        To the contrary. Usually found “training” to be insulting in the first place. Guess that says more about me and accepting jobs I’m overqualified for in the first place.

    2. Ray Phenicie

      There is an unstated presumption underlying this whole discussion; the need for labor unions is strongest in those areas that have inflexible job markets. By inflexible I mean markets that favor the employer usually where unemployment is high relative to the potential for employment. In the United States there has always been high but unrealized potential for full employment; the early 19th century labor market was heavily influenced by a militant state that opposed ( or knew nothing of) measures to generate full employment. The need to have a labor union in a market area is important because employees have protection against arbitrary and unfair labor practices that keep the lower echelons of workers intimidated and fearful. These low paid workers then become the grist for the mill of the revolving door of workers churning the job market seeking better opportunities.

      Segue into the scenarios outlined above. If there were responsible leaders in the US Congress, full employment could be obtained in a relatively simple manner: transfer more funds into the private sector through a job guarantee program that would hire anyone who did not have a job.

  2. not_me

    Again we have the conflation of work with jobs; neither requires the other; one can work without a job (ie. be self-employed) and one can have a job that does no or even negative work (destruction) such as the military often does.

    And it’s a losing conflation too, from an equality standpoint, since eventually capital will eliminate the need for almost all human workers. From whence jobs then? Pathetic and patronizing make-work from the government?

    Rather, we should aim for justice and let jobs take care of themselves since justice can never become obsolete or be outflanked.

      1. not_me

        Of courses accidents happen but we should not rely on them IF we want to maximize work that is meaningful BY DEFINITION. That will require justice.

          1. Lambert Strether

            I asked this question quite deliberately. There are two answers that I can see for “justice”:

            1) Some sort of deus ex machina, or unicorn, or magic pony;

            2) Political engagement by citizens.

            For #2, it’s important that people understand concrete material benefits — for example, “a job for everyone who wants one” — can result from engagement, because otherwise why waste their time?

            Since, with Big Lies like “Pathetic and patronizing make-work” — like FDR’s Federal Writers Project? Or the national parks system? — not_me systematically tries to undermine #2, I can only conclude that his answer is #1, which is why he is silent.

            1. Ray Phenicie

              For any system to be qualified by the term justice it must also generate, more often than not, outcomes that are seen as fair. More often than not, our current system is unfair, witness the large disparity of power to those with wealth. We have the best government that money can buy and it seeks to keep those in power who are already there. The beginning for fairness is a common understanding held by a vast majority of the participants as to what processes and outcomes the system should have. A consensus of ideas would be the logical outcome of an education system that was truly progressive.

        1. hunkerdown

          Why would we want to *maximize* work? Trying to accelerate the heat death of the universe, are we, or just the death of the underclass?

          To hell with that Stakhanovite rubbish. We need livelihoods, not work. Work presents itself well enough as it is.

          1. Calgacus

            The JG, full employment is not Stakhanovite, not about maximizing work. That is just a misunderstanding. The JG is about putting the choice to have a job, to work for an amount of money that roughly corresponds to the value of the work, in the hands of everyone. Societies that use money, that charge prices for stuff, but don’t provide individuals with any way to get some money when that individual wants are insane; they are simultaneously saying that individual is and is not a member of the society.

            Courtesy of /L, /lasse – here is some stuff from an architect of a non-insane society, the Swedish Model. Directly answering the “Why would we want to *maximize* work?” criticism:

            Ernst Wigforss: ”Om målet med samhällsutvecklingen skulle vara att vi alla skulle arbeta maximalt voro vi sinnessjuka. Målet är att frigöra människan till att skapa maximalt. Dansa. Måla. Sjunga. Ja, vad ni vill. Frihet.”

            “If the goal for society’s evolvement were that we all should work at maximum we would be insane. The goal is to liberate man to be maximum creative. Dance, paint, sing. Yes whatever you want. Freedom.

            See also Victor Quirk’s Advocating full employment & Wigforss’s Har vi råd att arbeta? (Can we afford to work?). The problem is that bad economics, bad accounting is so ingrained that people truly do not see genuine contradictions like that of monetary societies with unemployment. But people imagine non-existent contradictions between goals that fit hand-in-glove, like “full employment” & “dance, paint, sing” /” liberate man to be maximum creative”.

            1. Jesper

              Again with this falsehood?

              Sweden had a policy of striving for full employment but did not have a job-guarantee.

                1. Jesper

                  Logical fail. He starts the post about JG, then proceeds to bring up Sweden as a success.

                  JG wasn’t used in Sweden so it isn’t necessary for full employment.

                  1. Lambert Strether

                    C’mon. You don’t get to make an incendiary claim of “falsehood” and then just drop and shift to something new when you’re shown to be wrong.

                    He’s ” Directly answering the “Why would we want to *maximize* work?” criticism,” as well you know.

                    1. Jesper

                      Might be best to await his reply, then he can explain why he started with talking about JG to then proceed with comments about the good government Sweden had.

                      You’ve one interpretation of his post, I’ve got another.

                  2. Ben Johannson

                    Jesper, did you not notice the paragraph breaks? One does that when switching subjects, as in talking about the Jobs Guarantee in one paragraph and then Sweden in another. Nowhere did Calcagus state or suggest that Sweden had a Jobs Guarantee, and that’s very obvious to anyone with eyes to see.

                    1. Jesper

                      Excellent, then we’re in complete agreement – a JG was not implemented in Sweden.

                      Infrastructure was built without a JG.
                      Employment was increased without a JG.
                      Sweden got richer without a JG.

              1. Calgacus

                Jesper, Ben, Lambert: I did mean to compare the Swedish Model to a JG, to some degree. Of course Sweden did not have an explicit Job Guarantee, but it did have “Active Labor Market Policies” and a “solidaristic wage policy” that focused on employing and paying lower wage workers well and on wage uniformity. A Job Guarantee is both an active and solidaristic policy, and these policies undergirding Sweden’s low-inflation full employment therefore display particular resemblance to the JG and its operation. Wray says somewhere that that government spending, government employment targeted at uhh – the unemployed, if targeted and complete enough, is a Job Guarantee (What will they think of next? People eating when they’re hungry? Sleeping when tired? Outrageous!) For another example, the US WPA (& PWA, CCC, NYA etc) weren’t true JGs either, but are also considered close enough to derive insight from. Experiments & observations in any science are never perfect.
                Mitchell & Muysken wrote a book Full Employment Abandoned on the worldwide abandonment of full employment and full employment policies, comparing them to the explicit JG they propose. Most countries back then and Sweden particularly had a high degree of consciousness and conceptual understanding about what they were doing – but it wasn’t enough. Not enough to withstand the return of the Zombie ideas, taking advantage of the 1970s inflation. A higher and simpler, philosophical, conceptual understanding, that developed now by MMT was necessary. It’s like observing it may not be enough in the long run for a community to have few or no robberies & murders just now. There should be actual, explicit, carefully-drafted laws against these bad things.

                For instance, Mitchell & Muysken write:

                As a consequence, in the period between 1945 through to the mid 1970s, most advanced Western nations maintained very low levels of unemployment, typically below 2%.
                However, while both private and public employment growth was relatively strong during the Post War period up until the mid 1970s, the major reason that the economy was able to sustain full employment was that it maintained a buffer of jobs that were always available, and which provided easy employment access to the least skilled workers in the labour force. Some of these jobs, such as process work in factories, were available in the private sector. However, the public sector also offered many buffer jobs that sustained workers with a range of skills through hard times. In some cases, these jobs provided permanent work for the low skilled and otherwise disadvantaged workers.
                Importantly, the economies that avoided the plunge into high unemployment in the 1970s maintained what Ormerod (1994: 203) has described as a ‘…sector of the economy which effectively functions as an employer of last resort, which absorbs the shocks which occur from time to time, and more generally makes employment available to the less skilled, the less qualified.’ ” [Japan, Austria, Switzerland and Norway, though not Sweden, are given as examples of such]

                Part of the problem, may be taking “Job Guarantee” to mean something other than the accepted meaning. Recent Swedish workfare policy is not & is not claimed to be a Job Guarantee. And I do maintain that the Swedish Model in its heyday was much closer to a JG than such BS policies. It is just a fact – a fairly well-known one too – that poor and unemployed people, the common working man and woman everywhere – do definitely prefer a real job, a Job Guarantee to pure handout “welfare”. And this preference is entirely rational.

        2. rur42

          Meaningful work … almost oxymoronic. “what kind of job do you want with that degree in sociology?” asked the older halfbrother. The younger halfbrother (born post WWII) replied, “I don’t know, but I want to get a job I like.” “Good god!” exclaimed the older halfbrother, born preDepression era. “I worked for 40 years and not once, not one goddamned time, did I have a job I liked.”

          Times change.

          1. rur42

            Should add: Younger halfbrother eventually became a tenured professor of sociology in a job he came to loath, except for its benefits, salary, and free time.

      2. Massinissa

        But Lambert, it CAN be.

        And if washington doesnt change, even if they passed a JG or whatever you want due to,I dont know, widespread protest, it probably WOULD be make-work.

        And its not like widespread protest for a JG is even likely.

        1. Lambert Strether

          Well, lots of things “can” be. However, the commmenter continually asserts that it must be. Not so.

          And as you point out, we have a thing called politics to bring about policies that we support. In fact, you give examples of it.

            1. hunkerdown

              I think Massinissa is correct. There is a class that feels itself entitled as a matter of identity and tradition to exclude others from control over the means of production, and one suspects they would sooner not live than live without their tradition of uselessness.

            2. NoFreeWill

              The PTB would have to change even to get something as mildly reformist-radical as a Jobs Guarantee passed.

            3. Calgacus

              but unless the PTB change, im not convinced it wont be makework. What are they going to do? Insist that JG workers dig holes and fill them up again? Will that play in Peoria? How are they going to convince people that truly pointless make work is beneficial? How would they convince people that manifestly beneficial work is truly pointless? And how would they fight the “multiplier” effect of JG spending? Why do they have to make up so many lies to incite wars, to get the lesser people to murder their brothers, if they could just order them to do pointless or destructive things that way? Or would they insist that JG money be spent wisely? And then make the JG work better, succeed like only success can! The poor PTBs have an insoluble dilemma, and they know it.

              The Powers That Be have always known that the JG is not Stakhanovite nor “mild reformism”, but a decisive, structural change in the economy, a stake through their hearts. Once it exists, as with the WPA etc, their criticism of JG, their fighting against it, their thrashing and squirming against the stake, benefits the JG, the lesser people, and weakens TPTB themselves. As if by the action of an invisible hand, guided by the cunning of Reason, at long last.

              1. jrs

                Well if the particular version of JG rolled out was bad enough I suppose it could convince people govt doesn’t work …

                You don’t need to convince a worker that their work is beneficial, you merely need to convince them to do what they are told and get paid. Hopefully they refuse to do truly harmful things, but you still don’t’ end up at beneficial. Once you have workers doing useless things you don’t need to convince them of anything in order them to fight for them if they are their income. If it functioned like the rest of the world today functions …

                As for the military I suspect many are in it mainly for the economic advantages, the propaganda is for the taxpayers.

            4. Lambert Strether

              You mean — gasp! — politics might have to be practiced in order to, er, get the PTB’s attention and change their views?

              You’re pushing a counsel of despair. It’s disempowering. Why not turn it around and advocate for the best policy, instead of saying “the elite won’t l-i-i-i-i-i-k-e it”?

    1. Calgacus

      not_me:eventually capital will eliminate the need for almost all human workers.

      Capital, personified? Who is that?
      Eliminate “the” need for almost all human workers? Whose need? What about these human workers’ needs? What about them getting money when they say they need it, not when some (BIG) bureaucrat, plutocrat or utopian deems? These statements give the kleptocrats’ blinkered, managerialist view, that has worked itself into every corner of the minds they oppress.

      The conflation of work with jobs And a damn good conflation it is. Sure, they can differ, depending on whose view. But the point is that they can be the same. Murder and war is a job that is good work from the plutocrats view – it keeps them on top & kills the lesser people. What’s not to like? But the 99% have different views, different work, different jobs in mind.

      And it’s a losing conflation too, from an equality standpoint,

      It’s the only winning conflation, from that or any other sane standpoint.
      The JG is a win for the workers – they get valuable money.
      The JG is a win for society as a whole – it gets the valuable work. The JG is ALWAYS useful work – by definition. Useful by reasoned, democratic decision of what useful is, of what people want to do with their lives. Not_me utopianism relies on miraculous accidents. The MMT & the JG are just common sense.

      From the viewpoint of some, the JG is a job that does destructive work. They have always known & said the JG is socialism, is communism, is “mischief” that keeps capital from “degrading” the lesser people, to use Nassau Senior’s words. Well then, what could be more welcome than this wonderful destruction!

      Rather, we should aim for justice and let jobs take care of themselves since justice can never become obsolete or be outflanked. That’s what the aim and execution of the JG is, justice, Logic, experience & common sense show that jobs can’t “take care of themselves” . They never have and never will and that is why utopian proposals without it are unjust. If people want money – one sort of relation with others – a job, another sort of relation, doesn’t just magically “take care of itself” and appear without these others’ decision.

      The idea that JG work is “make-work” could not be wronger. First of all, all jobs, all cooperative work are “make-work” – the worker wants something that the other guy, the collective, the boss or Nature has. The way the universe works is that you don’t get things just by half-assedly wishing for them from some infinitely generous other. These other guys make you work for them. But there is no more make-work in the JG than in any other job, any government job. And every reason, based on logic and experience, to expect there will be much less than in other jobs. Why can’t people together decide what is good for them? Why shouldn’t they allow any of their number to help them attain this good for them, and then help that one in turn? Why should the society prohibit any individual’s decision to use their free time as they see fit – by doing some work for society, for money? No reason at all.

    2. djrichard

      “Pathetic and patronizing make-work from the government?”

      The Fed Gov has an effective history of putting people to work simply as a byproduct of making acquisitions. Is the resulting work pathetic and patronizing? Ask the people who are currently employed doing this work; I think they would beg to differ.

      All that’s needed for an effective JG program is for the Fed Gov to turn up the intensity of what it’s already doing: purchases/acquisitions, particularly for those things which are labor intensive (as opposed to robot intensive). Capitalists will hate this because it crowds out the fear in the population of being unemployed.

      1. Lambert Strether

        You’d thing the JG h8ters would read the current threads on dementia and say, “Whoa! Maybe there’s real, meaningful work to be done! Maybe to help my own parents!” But n-o-o-o-o…..

        1. jrs

          Then they can also read about the toll on caretakers of caretaking people with dementia. How they die years sooner than those who have never been caretakes – the years spent taking care of people with dementia almost come out of one’s own life, how caretakers themselves have much higher rates of dementia etc. than those who have never been caretakers. I mean I have no problem with people doing it out of love for whoever they are caretaking, why would anyone see it as anything but a deeply loving act? But it’s pretty darn obvious why noone rushes into it. And why almost no job compares with caretaking in terms of being stressful.

          1. Ray Phenicie

            The job guarantee program would generate full employment. In a society where full employment predominated, there would be more freedom for workers to move between jobs and change careers once every few years, than in a society where high unemployment predominated. If a career had a high risk factor one could move off the field when needed. Our education system could prepare folks for the idea of changing jobs as a motivating factor for keeping interest in work high.

  3. NotTimothyGeithner

    Anecdotally, my next door neighbor had to be separated from his family for contracting work. His wife wanted to stay with the kids*. Eventually, they moved, but the kids had to leave their friends. The woman across the street divorced her husband over a similar situation. It’s not just the mental health of the worker but the family.

    *The wife didn’t take care of their hydrangeas, and the kids are ruining a hedge in Colorado now and not leaving my gate open. All in all, my mental health has improved considerably since they left.

  4. Anonymous

    This paper is wrong. The economy needs temporary workers so wages can be flexible. If government intervention prevents wages from declining in a recession, the economy will never recover because resource costs will be too high. Corporations will be reluctant to hire unemployed workers because labor costs will be too high. The current recovery is weak and protracted because permanent workers comprise a large fraction of the labor pool. Society and the economy would be better off with fewer labor protections, an extinct labor movement, more temporary workers, and more adjunct professors!

    Did you all forget everything you learned in your Macroeconomics course?

    Poster’s disclaimer: The above statement is sarcastic in its entirety.

  5. craazyman

    they certainly have less jjob security but I don’t know about less cognitive skills.

    if sucking up, ass kissing, looking busy, paper pushing, going to meetings and generally unctuous bloviating are part of the family of cognitive skills then yes, temporary workers are at a decided disadvantage. No doubt. They usually actually have to work!

    to be fair, I tried to look up the original article to see what kind of inane madness was on that test for cognitive skills but the link didn’t seem to load. I admit, maybe I’m being too cynical. (but I doubt it hahahahahhaha) sorry

    1. TimR

      Exactomundo. I was going to write something like this, but with much more bloviation about it.

      The study itself is so peculiar when you’re not in that fishbowl of academia. They actually think they’re getting somewhere with this mumbo-jumbo!

      It’s offensive on the face of it, to me, to view human beings in this manner.. and study them in the context of our artificial human zoo, like lab animals.

    2. jrs

      It’s really a European, Spain specifically study I think and should be titled “on the job training is good for cognitive skills”, not so broad or new a conclusion, although I still don’t know how cognitive skills are defined.

      Apparently there is a large gap in on the job training, workshops etc. between temp and perm work in Spain as there is a lot of employment protection for perm workers and few for temp workers. Now ask an *American* about “employment protection” and get a deer in the headlights look. It doesn’t exist in this hire and fire at will country. Which is perhaps why neither does on the job training. I wonder what percentage of people ever get on the job training, 20% to be generous maybe? If so even if the same 8-16% figure held, it’s not that much of a difference.

      Conclusion: in the u.s. I suspect the downside of temp jobs for cognitive skills are almost certainly stress and uncertainty related. Also don’t rely on a fricken job to help your cognitive skills, read a book now and then. I mean until the revolution …

    3. JTFaraday

      Yeah, baloney. I mean, if it wasn’t bounded by limits and constraints on all sides (which will turn you into a robot sooner or later), they wouldn’t have defined “a job.”

      #1 cause of individual cognitive decline (or impairment): emotional distress, including clinical depression and tied for #2, the daily grind and groupthink.

      Actually, “groupthink” is a whole other (and prior) order of business, conditioning what it is even possible to think, but it doesn’t necessarily have to lead to individual cognitive impairment. It is at least theoretically possible to be a mole in the house of __whatever f*cked up hole you’re in this month__, provided you’re all there yourself.

      Oh, dear. Cheshire cat flash–


      1. JTFaraday

        And now that I think about it, it really is weird to keep hearing people saying that the long term unemployed are unemployable when the complaint in __the f*cked up hole we were in last month__ was that you couldn’t do anything with, you know, the “time servers” or whatever.

        Spin doctors everywhere. There’s only one cure for that.

  6. Paul Lafargue

    Can it be that the prime force behind devaluing labor – as in the dignity of work – are the capitalists, freed from countervailing forces (a labor movement, government regulation, ethical guidelines promulgated by esteemed religious figures), who gut whatever meaning remains in the concept? Historically, can we say that the inherent value of labor (dignity) in great part motivated the outrage of the proles of a previous era and was an impetus to fight back in order to achieve what shreds of dignity could be achieved through solidarity? Let’s assume these premises, then is it logical to conclude that a large component of the current labor force is devoid of the notion that there is Dignity in Labor? Further, again adopting all these assumptions, is it important to revive that notion, by for example advocating a JG? Or, as I believe, is it better to re-think the concept of Labor in such a way that it is divorced from the notion of a job and squarely embedded in the tasks that promote social and individual well-being. These musings may be criticized as an ahistorical quest for an age long gone when Labor was coterminous with Skill, but I think we can imagine (and that may be the first step to realization) Labor more as a ludic enterprise that may encompass skill as one aspect, but not a determining one. Those who know the work of Johan Huizinga will recognize the drift of these remarks.

  7. CuJo

    This study dovetails with the evidence that Pickett and Wilkinson presented in their book The Spirit Level, showing that a variety of social problems and health problems result from higher levels of inequality. Although “poor working conditions” (including temp status) and “degree of inequality” are separate no doubt they tend to have strong, positive correlations.

  8. washunate

    While I disagree that ‘skills’ or ‘training’ are relevant to what is happening in the western world generally and the US in particular, if one accepts that premise as true for a moment, it’s interesting considering this approach in light of JG/ELR/full employment concepts.

    JG, by definition, is temp work. The regular public sector employees are not JG workers. One of the claims sometimes is that JG will help the unemployed develop marketable skills, or at least prevent existing skills from decaying.

    I don’t mean to start a whole big conversation on this. Just food for thought on how labor markets work in practice. Creating dual systems doesn’t have much history of evidentiary success.

      1. washunate

        That’s a great question.

        I would be intrigued by a proposal that didn’t further entrench our dual labor market. If all public employees were treated roughly the same – both in terms of compensation structure and working conditions – that would be a very interesting proposal.

        But it wouldn’t be MMT. How can the academic sector support the looting in healthcare and finance and law and so forth if we don’t have situations like this?


      2. Lambert Strether

        Maybe somebody more expert than I (Calgacus?) can chime in, but in principle I don’t see a reason why not. I mean, so what? I think in fact the private firms would want and need to make better offers, and so people would leave for that reason.

        1. Ben Johannson

          Not to speak for Calcagus, there is no reason why JG employment can’t be permanent. Whether income sources from the government or non-government sectors is macro-economically irrelevant and won’t change aggregate output. The only possible objections are political.

      3. Ben Johannson

        It can. Bill Mitchell has stated there is no reason not to allow people who like the work to stay in it for as long as they wish, forever if they so desire.

    1. Lambert Strether

      It’s not “temp work” in the sense of casual labor, or where Kelly Girl gives you a call. The job is there if you want it. I think you’re conflating two concepts.

      1. washunate

        I didn’t intend to get into a detailed exchange on this. But you do raise an important clarification.

        In a nutshell, especially the American context, I would describe temp work as when the employee knows they need to be looking for another job. This could be for a number of reasons – the job will move and the employee doesn’t want to, the job will disappear, the job pays less than other jobs, the boss is terrible, the next assignment is terrible, there’s no room for growth, etc.

        But the common principle in MMT is that JG is not designed for long-term mass employment. It’s supposed to transfer workers to the private sector. That’s temp work.

        Or are you suggesting that 100 million workers should be on the public payroll indefinitely? Maybe more than that?

        Just to put some numbers to things:

        99 million workers made less than $40K last year (SSA #s –> totally random number since MMTers can’t agree on even a rough figure for the JG wage to be)
        2 million people in prison who obviously don’t want to be there, including 1 million who are working as modern day slaves
        92 million people not in labor force (BLS #s)
        13 million full-time students in higher ed (NCES #s)

        So that’s about 200 million people (some overlap between full time students and workers, of course — hmm, I wonder how the cost of college keeps going up despite massive unemployment if buffer stocks are supposed to act as price anchors?). And of course some people are quite happily retired, almost as if not going to work is more fulfilling than going to work…

        To suggest that even a small portion of those who would benefit from a JG would have a job as long as they want it is to say that the government will expand public sector staffing on a massive scale. I’m not saying that can’t happen. Quite the opposite, I’m taking seriously what it would mean to offer an actually decent term of employment.

        Rather, what I have run into is that when I suggest a JG that provides good working conditions, meaningful work, and decent pay would attract tens of millions of workers, I’m usually ridiculed for such absurdly high numbers.

        But it can’t go both ways. Either the JG is low-wage temp work that gets people back into the private sector, with all the attendant problems of inequality and poor job performance inherent in crap jobs, or it’s a career opportunity that will massively expand the scope of government permanently.

        Now I’m not instinctively opposed to the latter; many Americans, especially younger ones, are openly socialist, and it’s a position that should be taken seriously. But it’s not what MMT is talking about. MMT is still fundamentally rooted in the idea of private sector decision-making, right down to valuing increases in net private sector savings.

        1. jrs

          Well I suppose it could be used to get people into the private sector but a much better private sector. Yes a much increased minimum wage of course. And why not sick time and vacation time at ALL jobs? Now they are still jobs working for master, so they are still going to be a source of human misery, but they could have much better rock bottom standards for these things at least.

        2. Ben Johannson

          Or are you suggesting that 100 million workers should be on the public payroll indefinitely? Maybe more than that?

          To make your point more effective you should claim a Jobs Guarantee would draw hundreds of trillions from around the galaxy into the public sector. Use scarier numbers.

  9. Rosario

    This study is built on the assumption that our global culture’s perception of employment is sound. There is an enormous difference psychologically between someone who is “the boss” and someone who isn’t. Even with a good salary and benefits a person’s job can be soul crushing and miserable when 65 to 70 percent of their life is defined and dictated by someone else with whom they have little to no negotiating power. Possibly question the fundamentals? Or is this yet another “pragmatic” solution to our economic and social woes.

    1. Lambert Strether

      Well, maybe the JG is an opportunity to redefine that. Eh? I probably shouldn’t get into implementation detail, but speculating freely, why not find some tested management systems where there are far fewer managers* and more empowered workers, and make that the basis for implementing it? The ceaseless repetition of “make work” really does, I think, get in the way of imagining possibilities.

      * Sucking down exorbitant salaries, aggrandizing themselves, and playing divide and conquer.

      1. jrs

        Since most have probably worked a “make work” ie BS job at some point in their lives if not many points, in “capitalist” America, a world without make work is harder to imagine than one with.

      2. not_me

        The ceaseless repetition of “make work” really does, I think, get in the way of imagining possibilities. Lambert

        A BIG plus other resources like land would allow everyone to do the work THEY chose. So why do you wish to limit people’s choices, Lambert? To what you can imagine is “meaningful?”

        Speaking of justice, one should NOT have to work for restitution, should they? And hasn’t nearly the entire population been cheated by the banking cartel?

        1. Lambert Strether

          I fail to see how advocating the use of the imagination in defining the work done by jobs limits people’s choices.

          I ask again: Where does your justice come from? You didn’t answer before.

  10. Jeremy Grimm

    What an annoying piece of writing! I do not believe the authors have ever worked as temps.

    [I worked many years as a job-shopper to the Military-Industrial complex, a temporary engineer-programmer, also called a contractor. No! I am not proud about it. I saw when I first started engineering school how engineering was turning into a well-paid, but for other reasons crappy job. When I was a kid, I saw an entire generation of the best engineers laid-off after man walked on the moon. We all make the “best” choices open to us.]

    Take the issue of training. Temps are not trained because often they are hired to provide skills unavailable from the permanent employees, call them directs. Without some investment in training, both time and money, directs generally lack the skills hired in with a temp. We were always called “hired-guns”, recalling the gun-fighters hired for their speed, shooting accuracy, and willingness to shoot anyone identified as a target.

    In other cases temps are hired with the needed skills, usually no different from the skills of permanent employees doing the same job. The temps fill out temporary and long term increases in demand for a good or service but ever remain expendable. One or two decades ago, temps earned a pay differential for their mobility and easy expendability. In any case they help put fear into directs.

    The management at every job I was on went to lengths to create an enmity between directs and temps. It was common practice to lay-off directs whenever opportunity presented, while keeping the temps because they could be laid-off on a whim. Temps were often used as a prod to push directs. As a temp I was expected to perform without training and without more than a cursory description of the work required. Temps must read their clients desires and produce accordingly. This is a skill lacking in many directs who require some efforts expended to explain what was required of them.

    My experiences as a temp worker clash greatly with the conclusions of this piece. Temps have to come in already knowing the job. They have to perform or they will be laid-off, sometimes within hours. In many cases they are expected to outperform directs and supplement skills directs never developed. Of course, they are not trained. They are expected to bring the skills with them. What is unmentioned in the article — often directs are not trained either.

    I do not know what kind of temps and what kinds of employment the authors of this paper studied. As I indicated above, temps are a way to steal the skills trained by other employers or to take advantage of those who are “Smarter than the average bear” to get jobs done. Temps also give employers a tool for increasing the anxiety of directs and forcing speedups with the stick — “If you cannot perform as quickly and as well as the temps we keep, you too will be cast off. Do you want to join this band of hired-gun gypsies?”

    Temps give employers a tool to tell their employees how very fungible and unimportant they are. In the days of unions, what are called temps now might have been called “scabs” in some cases. I work in an amalgam of engineering and programming. I feel little guilt about having worked as a job-shopper in the past and as a “consultant” in the very recent past — soon to be unemployed. Engineers and programmers are too stupid and arrogant to ever form a union. They are “Mexican-crabs” of the workplace (please forgive my use of a term sounding racist. I am not racist, the term is, and the image fits too well not to use it).

    Any engineers or programmers reading my comment may be my guest at feeling insulted. As a group we deserve it, and I will go so far as to include myself if it pleases you! Lawyers are already a casualty, but medical doctors remain as one of the last of the professions. For all but medical doctors, profession only means that employers can legally not pay for overtime, they neither pay time-and-a-half nor pay straight-time for hours worked. Though elliptical to this discussion, we will all be professionals soon. It pains me to watch the demise of the medical profession as they become subsumed into the Medical Industrial Complex.

    1. jrs

      Too proud, too stupid, and in some cases though this is less obvious but it will leak out if you wait for it: too scared. But why should they be more scared than any other employee, especially as they can probably land another job etc.? Yea it’s not rational, perhaps it’s debt, perhaps it’s middle class culture.

      1. Jeremy Grimm

        Fear? Others may speak for themselves – yes fear.

        I became an engineer through fear. I have other gifts I might have tried. I working as an engineer for DoD out of fear, as I watched non-DoD engineering jobs disappear and turn to shit. Fear and anger against my employers kept me working as a job-shopper.

        I quit job-shopping when I married — very late in life. It took me too long to learn my greatest desire was to have children and a family. I greatly feared losing the mobility which kept me employed.
        Fear kept me working for the same consulting company as the market for engineers grew grimmer than when I started work in the middle 70s. I had my two children and not too long thereafter, I was divorced for reasons I still neither know nor fathom. Fear kept me working in engineering as I grew older. Did you know once the state of New Jersey sets your child support payment, based on your employment at the time of your divorce, changing it, whether you lose your job or not, is nearly impossible — and not paying the set amount could place you in jail? Yes, fear!

        As I grow old, the costs of college for my children, medical care, housing, and food grow — some like college and medical care growing at rates I could never have anticipated and never properly saved for. I am very afraid for the future. I am afraid for my children and the kind of life they may have as the world I knew, and watched collapse, grows worse by the month. So, yes I fear.

        As I face unemployment, two years before retirement age, I cannot share your optimism that I can probably land another job — unless you mean I could leverage my past experience working graveyard cleanup crew and hamburger flipper for Foodmaker Corporation. So I fear losing my job, such as it was.

        Where we might disagree though is whether fear is a part of just middle class culture. I know and have lived with those I considered poor, certainly not middle class in their values. They too know fear — fear as well as they know hunger — a feeling I have so far avoided.

        Remember the wisdom from “The Prince”, whether it is better for retaining control to be loved or feared?

        What of the rationality of my fears? Fear is not a rational emotion. I believe a rational thinker coldly examining my situation would feel fear. Middle class culture inculcates fear — fear of slipping from the middle class. Is that fear so irrational — just a part of middle class culture? I believe it is an ancient fear lived out lifetime-by-lifetime as those few who rose up from poverty saw how many slipped back into poverty. I do not believe the wheel of fortune spoke to kings and lords.

        I remain fearful. My theme for many years comes from an old folk song, Joan Baez sang, which admonishes “whoever treasures freedom, like the swallow, will learn to fly.” I would fly — but I do not know where to fly to. I am too old to be a revolutionary.

        I fear too many of those younger than I am, facing situations more dire than any I faced, will also not know where to fly to. Given how little it would cost to avoid this growing desperation I believe those who own our fates have lost their way. I fear the consequences and long to get far away from any large cities. When there is no hope left and nothing left to lose — nothing will hold back the anger and blood lust of the disposed. I fear our lords and ladies are too confident in their trust to militarized police, NSA, Blackwater and their like for defense of their privileges. I fear becoming part of the collateral damage.

        So yes, scared, and whether rational or not fear.

        More directly referencing your comment — do you really believe engineers “can probably land another job etc.?” and hence their fears are irrational or middle class? Most of the jobs for engineers, to replace the job I will lose, are a thousand miles away and a thousand figurative miles from the work I have done in the past. Employers started hiring people only to work at jobs they have already done for years. That is why there are so few “quailed” STEM workers. Except for the few scattered duplicates of my present job, my prospects are not bright. Fear is not irrational. What makes my fear grow is how much my prospects are better than those of the large part of our population seeking employment. Projecting my fears upon them and transforming them through the options of this other population I grow extremely fearful of what may come. Like the swallow, I would fly away — but to where?

        1. Alcofribas

          Thank you for your contribution, you nail the undergrounded reason why not only individuals but entire societies become hopeless. Fear.
          Remember the wisdom from “The Prince”, whether it is better for retaining control to be loved or feared?
          Wisdom ? In the old days, power was conquered by arms, and retained with dogmas and affective common events, celebrating the nations’ self confidencies. 1% of populations was educated. Now, in themselves called democracies, only the way to reach the power level is apparently democratical. The use of institutions is not. What to think about the 1787 Constitution of USA ? The best religion to keep people fear and obey is neoliberal economy, dedicated to educated but frightened and individually exploded populations. In the name of individual freedom, of course.
          What is equal freedom when some play with good cards and the largest part of humanity with bad ones ? When few rule the rules and others don’t know obscene rules (out of the public scene) ? A mechanism to enlarge inequalities and a common suicide. The best ideas, as freedom, when led to extreme, drive to the worst. Running fair institutions, fair rules, cannot be done with faith of many in few representatives. Of course, families and frienships are broken by enforced job mobility. Lost in translation…
          “Democratical” powers are lost too or become schizophrenic. Huge promises to common citizens during campaigns followed by crucial choices when elected : to have or not to have the courage to change rules, reform institutions when they appear to be structurally unefficient ? PRC hasn’t this problem, runs a safer and cleverer capitalism…but treats people as unbrained chess pieces.
          Can Dollar remain the widespread exchange money ? If for common american citizens, the interested answer is NO (US public debts can only increase), for TBTF bankers and many congressmen, the answer is YES : they don’t sincerely regulate finance markets to protect citizens and real economy enterprises. Financial markets rules the politician agendas. An instable world is good for speculators, their greatest fear is to loose the power to evaluate the wealths of States’s public finances, firms values, labor’s retribution. Going back to the 1936-1971 conception of banking ? Was the american people happy with bankers during those days ? Is financial globalization a huge private card for keeping UNO and democracies powers stupids ?
          Like the swallow, I would fly away — but to where?
          Can you escape from earth ? No and neither me. So the answer to feel secure for ourselves and future generations stands on two points imho : 1- what I can do alone (effectively to be poor in open country is not a life without beauty, even if rude), 2- what I can do as a social being (to find out with others how to make democracy evoluate).
          First solution is the hermit choice, or hermit community, that can be a solution for an existing person, but not for his descendants. You can do that inside the local national you’re living in. Second is to recognize we are not what the liberal dogma says, simply individual living objects that product and consume, born with good or bad cards in our hands. The difficulty is just that 200 states organizations are unable to fit the problem of global challenges, climate changes or finance regulation or inequal capitalism, for examples. You first need in that case to understand what your citizenship has become, on 7 december 2014. Is it only New Jersey and America based ? Or should it be World based too, but isn’t ? So my answer stands here : I wish you not to fear or dream for a fly to nowhere, not to dream to a sudden and perfect and unalterable divine change of rules and powers structure, but to be convinced that billions of citizens worldwide share with you the will of stability rather than profit. From purely ideological solutions, communism and liberalism, teached on different territories to be both the best/the worst things, we have to convince ourselves none was pure and true, but a part of truth stood in both, and that the planet will be a very safe and beautiful place to leave on if we manage to bring up new politicians, more balance managers than heroes. Democracies are sick, shooted with liberal drugs that benefit to few and destroy many lifes. Fascimus trends go up, but the worst has not come yet and can still be avoided. We have to keep lucid peoples for that.

        2. Moneta

          . It took me too long to learn my greatest desire was to have children and a family. I greatly feared losing the mobility which kept me employed.
          Then your temp work did have a cognitive impact and the research results hold up.

            1. Moneta

              The word stupid crossed your mind, not mine!

              Cognitive refers to how the brain processes data. Without the temp work, he most probably would not have had the same thoughts which made him structure his life around fear. Therefore the temp work had a cognitive impact.

    2. optimader

      Your comment is far more insightful than the article.
      I observed highly skilled PEs of my fathers generation offed in perpetual fear of being offed in the 1970s when they were in their late 40s-early 50s. Ugly. Observing them focused my personal strategy.

      The only real difference between permanent employees and temps is that the permanent employees don’t realize they are also temps. The bottom line is skillset, the one thing a former employer cant do is take away what you know.

      1. Lambert Strether

        “The only real difference between permanent employees and temps is that the permanent employees don’t realize they are also temps.”

        Reminds me of the time I pointed out to a supervisor that there was no yarn on the floor for the morning shift. Because of the layoff to come in a few hours, stupid me.

  11. Noni Mausa

    Controlling for motivation seems to me to consist of controlling for naïveté, or its opposite.

    My current, half time job is a case in point. I get very little explicit training (the corporation doesn’t even have a training manual, for instance.) Yet, I am expected to know our point of sale system, ship and receive, care for customers, understand and demonstrate our hundreds of tools and paints and finishes, accurately recommend materials and tools for specific projects, open and close the store, cash out and take in the deposit at the end of the day, create signage and displays, clean the building, including the lunchroom and washrooms, and more. Any upgrading of my knowledge of using our tools and supplies, I am expected to do on my own time at my own expense. I am also expected to keep abreast of our many rotating sales and, I was told a number of times, to memorize all the SKU numbers of our thousands of stock items. (Yeah, like that’s going to happen.) I am a keyholder, have been there 18 months, and am not in line for any bonuses, raises, or other benefits. I make $11.25 an hour, about 75 cents above our minimum wage.

    Why am I still there? Only because I am retired and find the job an interesting pastime, which I can leave at any time without a backward glance. There is zero loyalty on either side, and I could easily put down my clipboard any time and say, “You know what? I don’t need this.”

    My fellow staff members, including our young, overworked manager, do need the money, but their stress levels from overwork and unrealistic demands cannot be good for their health.

  12. Alcofribas

    Some things to be explained to US contributors :

    1- Till the 70’s, Spain was not a democracy but run by a fascist regime. It hardly makes 2 generations. Not enough to change minds and turn them into respect of workers as doubtless Know-how wealth of the firms. Quite the opposite of german situation, in which Kurzarbeit (time reduction of work/incomes for everybody inside the firm when orders slow down, but no difficulty for restart after the bad period, at no training cost and no research time loss).
    2- There stands a main difficulty inside Europe, while inside the euro zone two employment markets, supported by two different layers of cultural skills interfere. The study nails rightly that in south european countries, a post feudal scheme of societies separates the population in two parts : strong rights granted one, middle and upper class, and large far less granted one. A kind of two levels of citizenships system that underlay all relationships, very evident in terms of temp or permanent jobs, without any consciousness that quality is everywhere in the firm (from the boss to the few considered worker) or isn’t. Management is there a purely hierarchical organization, some taking all decisions, others executing them. Mix that with the old taylorist division of tasks and you get it. In the north countries, despite of recent neoliberal taste for financial profit even in manufacuring firms, the project culture and importance of many small self-governing firms make for long a true concern for everyone in the firm’s life. This of course relies on very strong attachment to local social life, and technical improvements are seen as survey conditions. Of course too, there only can be found two colleges co operating together the strategical management of firms, one with employees, one with managers and shareolders. Both being responsible of good or bad decisions, what Germans call Mitbestimmung. Not only the single labor market is largely dominant, but unemployment increases slowly in that case, without considering state’s sectorial implications to enforce specific policies. And don’t forget that the cohesive action of Landern (micro economy) and federal german (macro economy) powers is a real success.
    3- Mobility for jobs inside Europe is strictly reserved to high educated people, because of the creation of a continental multicultural country by union of many micro states. When nothing has been done seriously to give all european citizens multilinguistic skills, engineers (speaking 3-4 langages) can easily find jobs where they are, and masons and carpenters are captive of local employment situations.
    4- Applying the selective dogma of comparative specialized competences, most european governments have made of Europe a catastrophical continental area with well and bad diversified zones. Spanish growth depending massively of building sector, spanish economy was brillant when financial risks were taken by the government, local powers, banks and the citizens. Miracles don’t exist. Never.
    5- Inside a common money zone, you need a central state. Both to stop divergent local economical policies, and to protect people when a great crisis occurs. Without this, some zones hardly impressed severly fall down and no help is to be expected to restart economy and prevent deep social consequences.
    6- Potential Europe’s GDP is being injured. Young generation of Europeans is now paying for the unresponsible acts of their parents : maintaining local sovereignties in the macro economical competence is a major political fault.

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