Comment on T. Larson and P. Ong, "Imbalance in Part-Time Employment"

By Golden, Lonnie | Journal of Economic Issues, December 1995 | Go to article overview

Comment on T. Larson and P. Ong, "Imbalance in Part-Time Employment"


Golden, Lonnie, Journal of Economic Issues


In their March 1994 article, Larson and Ong (L-O) question the "contingent labor thesis" which holds that contingent jobs are rising at the direct expense of full-time jobs. They examine U.S. Bureau of Labor Statistics (BLS) series on part-time employment from 1968 to 1989 to illustrate that what they label "permanent" part-time employment peaked in the early 1980s and actually receded somewhat thereafter. They argue that this occurred because a secular climb in involuntary part-time (IPT) employment - the percentage of the labor force working fewer than 35 hours per week when they would prefer more - was offset by a decline in voluntary part-time (VPT) employment. They interpret the results of testing VPT and IPT equations as implying that while "structural change has occurred and the economy's ability to absorb labor into full-time employment has been reduced," this structural change is due to a shrinking labor supply of demographic groups who traditionally prefer part-time work hours. Thus, the trends of VPT and IPT employment since the early 1980s are attributed to labor supply constraints on employers, who must fill their part-time positions with workers who prefer full-time work hours.

While it is insightful to suggest a causal connection between the opposing trends in VPT and IPT, it leads the authors to conclude that there is "no evidence of continued growth in contingent labor." I believe they have reached this conclusion prematurely. For the five reasons discussed below, it would be regrettable if policymakers were persuaded that the contingent work trend is largely a supply - rather than demand - generated phenomenon and that its growth has subsided.

First, L-O combine the numbers in the shrinking VPT and growing IPT categories to get "permanent part-time employment." This omits from part-time status those workers classified as part-time who normally work a longer than 35-hour workweek (e.g., due to holiday, vacation, or sick time). It is also unfortunate terminology. "Permanent part-time" implies what Tilly [1992], using a segmented labor market framework, defines as retention part-time as distinct from secondary parttime jobs [also see Olmstead 1983 and Kahne 1985 for similar distinctions]. The retention segment is accompanied by permanence in the sense that it provides some job security. In contrast, "secondary" implies the absence of job security, relatively good pay, union representation, unemployment insurance, and employee benefit coverage. The contingent labor thesis is not so much about total part-time employment per se as it is more about the disturbingly large and perhaps growing share of short-hour jobs that are secondary in status. The BLS's own definition of "contingent work" centers on three aspects of employment: degree of job security, access to employee benefits, and unpredictability of work hours [Polivka and Nardone 1988]. Variability of work hours and the range of average weekly hours are wider for part-time workers [Dey 1989]. This makes their work contingent even if the job would not be classified as contingent in other respects. Thus, contingent work may be growing within part-time employment even if total part-time has not expanded.

Second, Schor's [1991] finding, which L-O cite, that average work hours increased from 1969 to 1989 suggests that the alleged decline in voluntary part-time employment may be an artifact of the data. If an increasing number of workers whose jobs are actually part-time in status are now working in excess of the 35-hour per week cutoff, it is the misclassification of these workers as full-time that may be reducing total part-time employment.

Third, L-O's empirical estimations are a reasonable first step but are far short of being definitive. The equations modeling VPT and IPT are reduced form estimates, and they omit some potentially important variables. Most noticeably absent from the authors' supply and demand framework is a variable controlling for the wage of part-time workers relative to their full-time counterparts, a variable that ought to be endogenized. …

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