Low-Income and Low-Skilled Workers' Involvement in Nonstandard Employment

The role of alternative work arrangements—temporary help, independent contractors, on-call workers, and contract company workers—has caught the attention of both policymakers and academic researchers alike. Current research indicates that 1 in 10 workers are employed in one of these four alternative work arrangements and employment in the temporary help services industry grew five times as fast as overall non-farm employment between 1972 and 1997. This growth is likely to have important implications for low-income workers, particularly since the establishment of the Temporary Assistance for Needy Families (TANF) block grant, authorized by the Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA) of 1996, which dramatically transformed the nation's welfare system. This welfare reform, in conjunction with a strong economy, has resulted in an increasing number of low-income individuals entering the labor force. Thus, alternative work arrangements, especially for those with limited work histories, might be expected to be a natural pathway to work for such workers. However, little is known about the prevalence of alternative work arrangements as a gateway into the labor force or the resulting labor market outcomes for low-income workers and those at risk of welfare dependency. The goal of this project was to examine the role of alternative work arrangements in today's labor market, paying particular attention to the effect of such arrangements on low-income workers in alternative arrangements and those at risk of being on public assistance.