Special Report. Characteristics of the Part-Time Work Force Analysis of the March 1993 Current Population Survey

Transcription

1 May 1994 Jan. Feb. Characteristics of the Part-Time Work Force Analysis of the March 1993 Current Population Survey Mar. Apr. May Jun. Jul. EBRI EMPLOYEE BENEFIT RESEARCH INSTITUTE The purpose of this Issue Brief is to present a comprehensive description of parttime work and part-time workers. The report describes trends in part-time employment; characteristics of part-time workers; health, pension, and other benefits available to part-time workers; and the advantages and disadvantages of part-time work to employers and employees. The report also identifies public policy issues stemming from the increase in the number of part-time workers. The number of part-time workers increased from 10.8 million to 20.7 million between 1969 and 1993, an increase of 91.7 percent, representing 24.6 percent of the growth in the work force. Full-time employment rose 51.4 percent, from 59.2 million to 89.6 million, representing 75.4 percent of new entrants. Aug. Sep. Oct. Nov. Dec Special Report and Issue Brief Number 149 While the part-time work force increased 91.7 percent between 1969 and 1993, growth as a proportion of the total work force has been minimal, rising from 15.5 percent in 1969 to 18.8 percent in 1993, a 3.3 percentage point increase over this 24-year period. Voluntary part-time workers represented 70.6 percent of all part-time workers in 1993, compared with the 29.4 percent classifying themselves as involuntary parttime workers. Between 1969 and 1993, the voluntary part-time work force grew from 9.0 million to 14.6 million, an average annual increase of 2.0 percent. The involuntary part-time work force increased from 1.8 million to 6.1 million, an average annual increase of 5.2 percent. Of the 28.9 million part-time workers in 1992, 71 percent received health insurance from one or more private sources. More than one-half (52 percent) received coverage through an employment-based plan, and 19 percent through another private source. By comparison, 81 percent of full-time workers received coverage from a private source: 73 percent through an employment-based plan and 8 percent from another private source. Just over one in five, or 21 percent, of part-time workers were uninsured; 16 percent of full-time workers were without health insurance. While the likelihood of a part-time worker being uninsured is 5 percentage points higher than for full-time workers, there are more full-time workers uninsured (16.4 million full-time workers were uninsured in 1992, compared with 5.9 million part-time workers). Thirty percent of part-time workers reported that their employer or union had a pension or other type of retirement plan (other than Social Security) for any of its employees. Fifty-eight percent of individuals working full-time reported such coverage. Of workers indicating their employer or union sponsored a plan, 38 percent of part-time workers participated in the plan, compared with 83 percent of full-time workers. An EBRI Special Report SR-22 EBRI Issue Brief Number 149 May EBRI May 1994 EBRI Special Report & Issue Brief 1

2 Publisher s Note This EBRI Issue Brief provides a complete description of the characteristics of part-time workers, such as their age, gender, work-related characteristics (e.g., industry) and their receipt of benefits relative to full-time workers. Data are primarily drawn from the Employee Benefit Research Institute s (EBRI) original analysis of the March 1993 supplement to the Current Population Survey, conducted by the Bureau of the Census. As a result, this Issue Brief provides a large amount of data that have not yet been published in any other form. While this report provides some information on the contingent work force as a whole, it focuses primarily on the characteristics of part-time workers and their receipt of health and pension benefits relative to full-time workers. Table of Contents Introduction.. 4 What Is Part Time?... 6 Alternative Work Arrangements...7 Trends Employee Leasing...8 Home-Based Work...8 Independent Contractor... 9 Job Sharing...9 Part-Time Workers...9 Self-Employment...9 Temporary Employment...9 Table 1, Persons Aged 16 and Over by Work Status, Chart 1, Voluntary and Involuntary Part-Time Workers, Aged 16 and Over as a Percentage of All Workers, and Gross National Product, Table 2, Involuntary Part-Time Workers Aged 16 and Over as a Percentage of All Workers; Gross National Product; and Percentage Change in GNP; 1969 to First Quarter Chart 2, Percentage of Part-Time Workers, by Industry, Use of Part Timers...13 Industry...13 Chart 3, Industry Group, by Percentage of Part-Time Workers, Firm Size Unions...14 Chart 4, Firm Size, by Percentage of Full- and Part-Time Workers, Characteristics of Part Timers Age and Gender...15 Table 3, Wage and Salary Workers by Full- and Part-Time Status and Union Affiliation, Chart 5, Part-Time Workers Aged 16 and Over, by Voluntary and Involuntary Part-Time Work Status, Chart 6, Percentage of Individuals within Selected Age Groups, by Full- and Part-Time and Nonworker Status, Income...17 Education Family Type Chart 7, Age, by Percentage of Part-Time, Voluntary Part-Time, and Involuntary Part-Time Work Status, Chart 8, Part-Time Workers, by Age and Gender, Table 4, Median Hourly Earnings of Workers Paid Hourly Rates, by Gender and Full- and Part-Time Status, Annual Averages, Race and Origin...19 Full-Year/Part-Year Work Status Weeks Unemployed...20 Benefits of Part Timers Chart 9, Unemployment Experience Among Part-Time Workers, by Voluntary and Involuntary Part-Time Work Status, Health Insurance...21 Chart 10, Full- and Part- Time Workers, by Selected Sources of Health Insurance Coverage, Chart 11, Percentage Uninsured Among Fulland Part-Time Workers, by Firm Size, Chart 12, Percentage of Full- and Part-Time Workers with Direct Employment-Based Health Insurance Coverage, by Firm Size, Chart 13, Selected Sources of Health Insurance Coverage for Part-Time Workers, by Industry of Primary Employment, Chart 14, Age and Gender, by Percentage of Part-Time Workers without Health Insurance Coverage, Pension Coverage and Participation Chart 15, Pension Coverage and Participation Rates, by Full- and Part-Time Work Status, Chart 16, Full- and Part-Time Worker Pension 2 May 1994 EBRI Special Report & Issue Brief

3 Coverage, by Firm Size, Chart 17, Full- and Part-Time Worker Pension Coverage, by Private Industry, Other Benefits Chart 18, Percentage of Part-Time Workers in a Firm with a Pension Plan and Percentage of Part-Time Workers Participating in a Pension Plan, by Age and Gender, Advantages and Disadvantages...29 Employers Table 5, Full- and Part-Time Employees Participating in or Eligible for Selected Employee Benefit Programs, Medium and Large Private Establishments, 1991; Small Private Establishments, 1990; State and Local Governments, Employees Public Policy Issues...33 Conclusion Further Research Technical Notes...36 The Current Population Survey EBRI Analysis of the CPS...37 Definition of Part-Time Workers and Multiple Jobholders...37 Table 6, Employment Status of the Civilian Noninstitutionalized Population Aged 16 and Over, Glossary of Terms...38 Appendix...40 Reading the Tables Table 7, Work Status of Persons Aged 16 and Over, by Industry, Table 8, Work Status of Persons Aged 16 and Over, by Firm Size, Table 9, Work Status of Persons Aged 16 and Over, by Gender and Age, Table 10, Work Status of Persons Aged 16 and Over, by Gender and Wage and Salary Earnings, Table 11, Work Status of Persons Aged 16 and Over, by Annual Family Income, Table 12, Work Status of Persons Aged 16 and Over, by Race and Family Income as a Percentage of Poverty, Table 13, Work Status of Persons Aged 16 and Over, by Unemployment Experience, Table 14, Work Status of Persons Aged 16 and Over, by Gender and Education Level, Table 15, Work Status of Persons Aged 16 and Over, by Family Type, Table 16, Work Status of Persons Aged 16 and Over, by Full-Year/Part Year Status, Table 17, Sources of Health Insurance Coverage for Persons Aged 18 and Over, by Work Status 54 and Industry, Table 18, Sources of Health Insurance Coverage for Persons Aged 16 and Over, by Work Status and Firm Size, Table 19, Sources of Health Insurance Coverage for Part-Time Workers Aged 16 and Over, by Involuntary and Voluntary Work Status, Table 20, Sources of Health Insurance Coverage for Persons Aged 16 and Over, by Work Status, Gender, and Age, Table 21, Sources of Health Insurance Coverage for Persons Aged 16 and Over, by Work Status, and Wage and Salary Earnings, Table 22, Sources of Health Insurance Coverage for Persons Aged 16 and Over, by Work Status and Family Income, Table 23, Sources of Health Insurance Coverage for Persons Aged 16 and Over, by Work Status and Family Type, Table 24, Sources of Health Insurance Coverage for Persons Aged 16 and Over, by Work Status, Table 25, Sources of Health Insurance Coverage for Persons Aged 16 and Over, by Work Status and Region, Table 26, Pension Coverage and Participation for Workers Aged 16 and Over, by Work Status and Industry, Table 27, Pension Coverage and Participation for Workers Aged 16 and Over, by Work Status and Firm Size, Table 28, Pension Coverage and Participation for Workers Aged 16 and Over, by Voluntary and Involuntary Work Status, Table 29, Pension Coverage and Participation for Workers Aged 16 and Over, by Work Status, Gender, and Age, Table 30, Pension Coverage and Participation Among the ERISA Work Force, by Work Status, Gender, and Age, Table 31, Pension Coverage and Participation for Workers Aged 16 and Over, by Work Status and Wage and Salary Earnings, Table 32, Pension Coverage and Participation for Workers Aged 16 and Over, by Work Status, Table 33, Pension Coverage and Participation for Part-Time Workers Aged 16 and Over, by Selected Characteristics, May 1994 EBRI Special Report & Issue Brief 3

4 Changing economic, labor, and social environments as well as an Introduction increase in the absolute number of part-time workers have created new interest in assessing the working conditions, pay, and benefit packages of part-time workers. Increased global competitiveness, shifts in industrial sectors for example, from manufacturing to services and the addition of many more women to both full- and part-time labor pools provide impetus for a change in the way workers are employed and a change in labor laws to meet the needs of new types of employer/employee relationships. The shift from manufacturing to information and services industries requires individuals who are educated, motivated, and rewarded differently than their industrial predecessors (Employee Benefit Research Institute, 1989). 1 For example, service employment often requires flexible employment options and may not uniformly provide job stability or opportunities for fulltime employment. Thus, some of the employment expansion during the 1970s and 1980s occurred in industries characterized by jobs offering only part-time hours and, often, low wages and few or no benefits (durivage, 1992). The increasingly widespread dissemination of knowledge and information made possible by computer and telecommunications technology is also challenging many long established traditions. Today, a growing number of individuals and small groups are able to operate effectively without the support or assistance of the larger organizations. This can mean increased flexibility for some workers. However, according to U.S. Labor Secretary Robert Reich, technological advances 1 For a further discussion of transitions taking place in the American labor market and the impact these changes will have on employee benefits, also see Employee Benefit Research Institute, 1982 and are also partly responsible for downsizing and for pushing some workers into involuntary part-time or temporary jobs (Marshall, 1994). The age composition of the labor force and family structure are changing. Two-earner families, low birth rates, and demographic diversity are changing the environment of employment and of employer/employee relationships and contracts. In addition, while a higher percentage of college and high school graduates is in the labor market today than 20 years ago, given the decline in the number of native-born workers, the increasing cost of a college education, and the heavy influx of uneducated immigrants, employers in the future may have to underwrite expensive training programs and rethink employment and hiring practices to preserve their work force. Furthermore, all of these changes are taking place at a time when increased global competitiveness requires that to remain competitive, employers operate in an environment characterized by flexibility and swift proactive performance. Demographic changes have caused not only the employer but also the employee to make demands regarding work environment that differ from the demands made in the past. For example, as the number and proportion of women entering the work force increases, the demand for family oriented benefits grows. These benefits may include, for example, part-time, flexible, or home-based work schedules, parental leave programs, and day care and elder care assistance. Workforce 2000, a study funded by a grant from the U.S. Department of Labor, indicates that most of the policies and laws that govern today s economy and labor markets were originally devised during the 1930s or 1960s in response to the conditions and problems of those decades. Social Security, welfare, unemployment insurance, training programs, and many other federal programs trace their roots either to the New Deal or to the Great Society, according to the authors (Johnston and Packer, 1987). Thus, numerous changes have led to an increase in the number of individuals working in part-time or 4 May 1994 EBRI Special Report & Issue Brief

5 other alternative arrangements. Employers reasons for offering part-time work vary but, in general, they reflect a perceived opportunity to gain greater control over labor costs including employee benefits as well as to meet employee requests for alternative work schedules; to maintain a flexible work force to meet peak and slack times in the business day; and to meet the changing demands of a global economy. In an attempt to achieve these goals, a number of firms are adopting flexible hiring practices, maintaining only a core of traditional, full-time employees (Callaghan and Hartmann, 1991; U.S. Congress, 1991). Many workers choose to work part time because it provides flexibility for family commitments, study, or avocations. Others turn to part-time employment involuntarily as an alternative to unemployment. Still others may respond to surveys that they are involuntary part-time workers, although in fact they are kept from full-time employment by their own personal constraints, such as a need for a flexible schedule. Between 1969 and 1993, the number of workers grew by 40.3 million. The number of part-time workers increased from 10.8 million to 20.7 million, an increase of 91.7 percent, representing 24.6 percent of the growth in the work force. Full-time employment rose 51.4 percent, from 59.2 million to 89.6 million, representing 75.4 percent of new entrants. Fifty-seven percent of the growth in part-time employment was voluntary; 43 percent was involuntary. Changes, including the increase in the part-time work force, must be kept in perspective. While the parttime work force has increased 91.7 percent, this growth as a proportion of the total work force has been minimal, rising from 15.5 percent in 1969 to 18.8 percent in 1993, a 3.3 percentage point increase over this 24-year period. Furthermore, the proportion of the total work force that is part time has fluctuated, such that the 1993 level of 18.8 percent is lower than the level in other years during this period. For example, in 1982, 20.2 percent of the total work force was employed part time. In addition, as a percentage of the total work force, the voluntary segment of the part-time work force has remained fairly constant. It is in the involuntary part time work force that fluctuations have occurred, generally following economic cycles. Thus, economic cycles contribute to the fluctuations in full- and part-time employment patterns, as do changing demographics and a restructuring of corporate America. In times of economic prosperity, involuntary part-time employment has declined as a percentage of the total work force, and in times of economic downturns, involuntary part-time employment has risen. Nevertheless, even if the proportion of all workers in part-time status were to remain constant, the growth in the absolute number of part-time workers particularly among involuntary part-time workers draws public policy attention to this area. Part-time workers earn less per hour, on average, than full-time workers and are less likely to receive employment-based health, retirement, and other benefits (such as life insurance) than their full-time counterparts. These differences are particularly pronounced for involuntary part-time workers. At a time when the nation s attention is focused on access to health care and the retirement prospects of the baby boom generation, an increase in the number, even if not in the proportion, of individuals in a group less likely to receive these benefits raises questions about these individuals work status and level of economic security. The purpose of this Issue Brief is to present a comprehensive description of part-time work and parttime workers. 2 The report describes trends in part-time employment; the employers of part-time workers; characteristics of part-time workers; health, pension, and other benefits available to part-time workers; and the advantages and disadvantages of part-time work to employers and employees. It identifies public policy 2 The report covers individuals who work fewer than 35 hours per week in a majority of the weeks in which they work during the year, regardless of type of employment contract (e.g., independent contractor, temporary employee). This definition is consistent with the U.S. Department of Labor s definition of a part-time worker. That is, the definition of part-time work is based on the number of hours worked. It does not take into account the type of employment contract involved or the number of jobs a person may hold. May 1994 EBRI Special Report & Issue Brief 5

6 issues stemming from the increase in the number of part-time workers. Data are primarily from EBRI tabulations of the March 1993 supplement to the Current Population Survey (CPS). Trend information describing part-time work is from the U.S. Department of Labor Bureau of Labor Statistics (BLS) Employment and Earnings. 3 For a discussion of methods regarding these two survey sources, see the Technical Notes section on page 36. What Is Part Time? The definitions of a standard work week and part-time work have changed over the years. BLS now defines part-time workers as those who work fewer than 35 hours a week and full-time workers as those who work 35 or more hours per week. At the turn of the century, a standard work week was approximately 53 hours. The Fair Labor Standards Act (FLSA) of 1938 (effective in 1940) established a standard work week of 40 hours for nonsupervisory employees of firms engaged in interstate commerce. Many federal and state statutes and union contracts have stipulated a second standard: the 8-hour day. The 5-day week became a third implicit standard. Although the work schedules of American workers are changing, work schedule data continue to be based on the 40-hour week (Smith, 1986). For example, the FLSA, the primary federal law regulating the wages and working conditions of American workers, requires that covered employees receive an hourly minimum wage for the first 40 hours worked each week and overtime pay for any additional hours worked. The Employee Retirement Income Security Act of 1974 (ERISA), which regulates private employer pension plans, requires pension coverage of all workers above 1,000 hours per year (the equivalent of approximately 20 hours per week). For pension purposes this might be deemed the line between full- and part-time work. The classification of part-time workers as voluntary or involuntary is used to denote worker choice. A voluntary part-time worker chooses to work part-time, whereas an involuntary part-time worker states a preference for, but is not in, a full-time job. Some analysts note that it is not clear how many of those counted among the voluntary part-time work force indicate they are willing to work part time but would prefer to work full time. Some may indicate they voluntarily work part time, realizing they are limited in the hours they can work by child care, transportation, or other special needs (Levitan and Conway, 1988). Others, who classify themselves as involuntary part-time workers may be part time due to factors unrelated to job availability such as their own needs for flexibility. Short time, secondary part time, and retention part time are more descriptive in that they suggest why, where, and how part-time employment is used (Tilly, 1992). Short-time employment, a common practice in goods-producing industries such as manufacturing, construction, and mining, is often used to avoid layoffs by reducing workers hours during a business downturn, then restoring them to full time when sales revive. 3 Trend data from the Bureau of Labor Statistics (BLS) and Employee Benefit Research Institute (EBRI) analysis of the March 1993 supplement to the Current Population Survey (CPS) are not directly comparable. Data from BLS are based on a 1-week reference period, while data from the March supplement, which EBRI uses, are based on a full year reference period. EBRI uses the March supplement to allow detailed analysis of the receipt of noncash benefits such as pensions and health insurance. Because the reference period for the March supplement is a full year, the total number of persons with some employment and/or unemployment over such a long period exceeds the average monthly levels. Data also differ slightly because EBRI data exclude active duty military and members of their families, while BLS exclude only active duty military. 4 In 1791, Philadelphia carpenters won their arguments for a reduced and standardized work day. However, public opinion, did not support the 6 a.m. to 6 p.m. schedule that replaced the more nebulous sun-up-to-sun-down work schedule. Idleness was considered a vice, so a shorter work day was viewed as a step toward moral decay (Pierce, et al., 1989). 6 May 1994 EBRI Special Report & Issue Brief

7 Secondary 5 part time jobs, most common in service industries, often offer low wages and limited benefits, with limited opportunity for advancement (Tilly, 1991 and 1992). These jobs are characterized by low skill requirements, low productivity, and high turnover. For some, secondary jobs are a form of involuntary part-time employment; for others, secondary part-time jobs are voluntary, providing, for example, a means to supplement family income. In contrast, retention part time jobs have skill and compensation levels comparable to those of full-time workers. They are created to retain or attract valued employees who desire part-time work. Flexibility is important to these workers, and their managers often accommodate the schedules of such workers. The jobs are characterized by high productivity, high compensation, and low turnover (Tilly, 1992). Alternative Work Arrangements The term contingent employment 6 is often used to describe alternatives to full-time work arrangements through which full-time workers are hired by, and work for, a single employer. Contingent employment broadly covers flexible employment practices, such as temporary work, employee leasing, self-employment, contracting, and home-based work as well as part-time work. Contingency work implies shifts in three traditional notions of employment: time something different from an 8-hour, 5-day week; permanency something other than a permanent relationship between employer and employee; and social contract something different from the traditional reciprocal rights, protections, and obligations between the worker and the employer (Christensen and Murphree, 1988). Employers often use contingent workers to surround a core of full-time workers. The increasing use in absolute numbers of alternative workers has encouraged the growth and development of new industries that hire and manage such work forces. For example, temporary help and leasing firms are flourishing. Some of these firms are beginning to resemble traditional employers in that they provide employee benefits and opportunities for worker advancement. Between 1969 and 1993, the part-time work force increased from Trends 15.5 percent to 18.8 percent of the total work force (table 1). The data in this table represent the proportion of individuals counted as working part time. The proportion might appear slightly larger if available statistics counted the number of part-time jobs rather than the number of part-time workers. 7 In the decade 1980 to 1991, for example, the percentage of multiple jobholders went from 4.9 percent to 6.2 percent of the work force (U.S. Department of Labor, 1991; Tilly, 1992). 5 For a further explanation of the primary and secondary labor forces, see Ehrenberg and Smith, This term was coined by labor economist Audrey Freedman, at a 1985 conference on employment security. It connotes conditionality, as indicated by a need for labor due to increased demand for a product or service, at a particular place, at a specific time (Freedman, 1988). 7 The CPS now counts employed persons holding more than one job, only once. For persons working in more than one job, data relate to the number of hours worked in all jobs; all hours are credited to the job at which the individual worked the greatest number of hours. The redesigned CPS, initiated in January 1994, asks how many jobs an individual has, and if the response is more than one job, how many hours are worked on the main job and how many hours are worked on all other jobs. May 1994 EBRI Special Report & Issue Brief 7

8 Characteristics of contingent employment are summarized below. Alternative Work Arrangements Temporary workers Source: Stanley Nollen, Exploding The Myth: Is Contingent Labor Cost-Effective? Report prepared for conference on New Ways to Work, Reinventing the Workplace: New Perspectives on Flexibility in Tomorrow's Competitive Company, June 16 17, 1993, New York, NY. A core ring model (as shown above) is sometimes used to describe the mix of workers in an employer s human resource system. In this model, the core consists of regular employees, mostly full time, who are directly attached to their employer and who expect long-term employment to be continued. The ring surrounding the core, where changes in work force size are more likely to occur, consists of contingent workers. 8 The theory of the model is that the jobs of core employees are buffered and protected by ring employees. This paper focuses only on part-time employment; however, several types of employment, both full- and part-time, may be considered a type of contingent employment, including the following. Employee Leasing RING CORE Regular full-time employees Short-term contract workers Part-time workers A person performing services for a recipient employer 8 It is estimated that contingent employment (sometimes referred to as coemployment or flexible staffing) represented approximately 25 percent to 30 percent of the civilian work force, ranging from 32.0 million to 37.9 million workers in 1992, up from a range of 25.0 million to 28.5 million (23 percent to 27 percent of the civilian work force) in 1980 (Belous, 1994). Belous estimates that there were approximately 1.4 million temporary workers, 22.6 million part-time workers, 5.3 million business service workers, and 8.6 million self-employed workers, for a total upper boundary of 37.9 million contingent workers in However, it is difficult at best to measure the exact number of individuals in alternative work arrangements. The federal government has no official measure of this group; thus, data must be derived from a number of public and private sources. Furthermore, several of the definitional categories overlap and, in many instances, data have not been collected or are only beginning to be collected, for selected categories within this group. under one or more agreements with a leasing organization for at least one year is considered a leased employee. The Tax Equity and Fiscal Responsibility Act of 1982 (TEFRA) contained a provision whereby employee leasing became attractive to some small businesses because of favorable pension and tax advantages. Although the Tax Reform Act of 1986 limited tax advantages, employee leasing has continued. Some employers have terminated staff with the understanding they will be rehired by an employee leasing company and returned to their jobs. Prior to 1982, there were few employee leasing firms in the United States, with the number of leased employees estimated at under 5,000. In 1988, there were more than 350 leasing firms, contracting employees to thousands of small businesses (Ulrich and Hollon, 1988). Home-Based Work Work done at home, as part of one s regularly scheduled employment, falls under the category of home-based work. This may be full- or part-time work and involve the use of a personal computer, modem, fax, or multiple phone lines. BLS data from a special supplement to the May 1991 CPS indicate that approximately 20.0 million workers (18.3 percent of all workers) in nonagricultural industries did at least some work at home as part of their primary job in Just over 14 million (14.3 million) of these workers were nonagricultural wage and salary workers. An additional 5.6 million were self-employed individuals. However, only a small portion of the wage and salary workers were in formal work-at-home arrangements (1.9 million, or 13.1 percent of the wage and salary workers), and the majority worked fewer than 8 hours per week at home (10.3 million, or 71.8 percent of the 14.3 million). Most of these workers were merely taking work home from the office without being officially compensated. Data were also collected on persons working at home in a supplement to the May 1985 CPS. BLS analysis of these data indicates that approximately 18.1 million individuals in nonagricultural industries were working at home in 1985, compared with the 20.0 million in However, the 1985 data are not directly comparable to the 1991 data due to a change in the wording of questions and the addition of new questions (U.S. Department of Labor, 1992). 8 May 1994 EBRI Special Report & Issue Brief

9 Independent Contractor There is no clear distinction between the terms employee and independent contractor; federal courts differ in their rulings. The Internal Revenue Service uses 20 factors in judging a situation, of which at least 14 deal with issues of control. The National Labor Relations Act of 1935 is the primary body of federal law governing labor-arrangement relations in the private sector. Under the statute, the right-to-control test governs whether an individual is an employee or an independent contractor. Firms contract for specific jobs to be carried out by another employer. Work may be transferred off premise or, as in food service and cleaning, may be done on the contracting firm s premises. In either case, the workers are on the other employer s payroll. Independent contractors may be self-employed workers under personal contract to their employers. Self-employed workers, as free-lancers or consultants, are hired for a finite period of time. In 1988, there were 9.5 million self-employed or independent contractors (U.S. Congress, 1991). Job Sharing A concept developed in the 1960s, job sharing is a form of part-time employment in which two employees share the tasks, responsibilities, and compensation (wages and benefits) of a full-time job. Two people may divide responsibilities and provide backup for one another, or they may perform completely separate tasks. In the latter case, the names of the two people are matched only for head-count purposes. Job sharers may divide the hours of the day, work alternating days or weeks, or adopt any other configuration that is mutually agreeable to the employees and their supervisor. Job sharing is used as a way to provide part-time employment opportunities in job classifications that cannot be significantly reduced in hours or split into two part-time positions. No estimates of the number of employees in this category are available. Part-Time Workers hold. BLS data indicate that there were 20.7 million part-time workers in 1993 (18.8 percent of the total work force) (table 1). EBRI analysis of the March 1993 CPS indicates that there were 28.9 million part-time workers in 1992 (21.8 percent of the total work force) (see table 7). 9 Self-Employment Entrepreneurship and work autonomy are common features of self-employment; the overriding attribute for most self-employed persons is independence. Analysis of the March 1993 CPS supplement indicates that there were 13.7 million self-employed workers in 1992 (see table 7). Temporary Employment Part-time workers, according to the U.S. Department of Labor, are individuals who work fewer than 35 hours per week. The definition does not take into account the type of employment contract an individual may have or the number of jobs a person may 9 See footnote 3 on page 6. In a temporary employment arrangement, limited duration is understood by both employee and employer; time is measured in days, weeks, or months, rather than years. Temporary employment may involve on-call arrangements between particular employees and employers, use of temporary help firms, or short-term direct hires. It may be part of an internal temporary pool that is managed by the company. The pool may consist of former employees and/or external hires. Persons may be hired through a temporary service firm, making them employees of the agency. Traditionally, temporary workers have been used to fill positions open due to sick leave, vacations, terminations, or resignations and to smooth out peak or heavy seasonal workloads. One study estimates that there were 1.4 million temporary employees in 1992 (Belous, 1994). Another study indicates that the number of temporary help jobs as a percentage of total employment increased from 0.26 percent to 1.18 percent between 1970 and 1992 (Steinberg, 1993). While some workers, for example part-time or self-employed workers, are often included in discussions regarding the contingent work force, these workers may or may not be contingent workers in the strictest sense of the term. For example, a part-time employee may be as fully attached to his or her employer as the full-time employees employed by the company in the sense that the part-time worker s employment is not conditioned, or contingent, on the employer s need for labor and is considered to be a permanent arrangement by both the employer and employee. May 1994 EBRI Special Report & Issue Brief 9

10 Table 1 Persons Aged 16 and Over by Work Status, a Year Total at Work Full Time All Part Time Voluntary Part Time Involuntary Part Time (thousands) ,018 59,181 10,837 9,027 1, ,684 59,101 11,583 9,387 2, ,146 59,203 11,943 9,503 2, ,662 61,317 12,345 9,937 2, ,182 63,560 12,622 10,311 2, ,282 64,083 13,199 10,490 2, ,396 62,325 14,071 10,581 3, ,024 64,810 14,214 10,942 3, ,999 67,263 14,736 11,439 3, ,693 70,543 15,150 11,934 3, ,133 72,647 15,486 12,205 3, ,325 72,022 16,303 12,338 3, ,445 72,732 16,713 12,316 4, ,552 72,245 18,307 12,455 5, ,038 73,624 18,414 12,417 5, ,246 78,030 18,216 12,704 5, ,303 79,931 18,372 13,038 5, ,821 81,974 18,847 13,502 5, ,448 84,398 19,050 13,928 5, ,101 86,627 19,474 14,509 4, ,102 88,482 19,620 14,963 4, ,697 89,081 19,616 14,756 4, ,864 87,513 20,351 14,584 5, ,457 88,012 20,445 14,329 6, ,340 89,597 20,743 14,637 6,106 (percentage) % 84.5% 15.5% 12.9% 2.6% Source: U.S. Department of Labor, Bureau of Labor Statistics, Employment and Earnings (Washington DC: U.S. Government Printing Office, January issues). Data prior to 1969 are not available in this publication. Note: A change in methodology used to estimate labor force characteristics beginning in January 1982 caused increases in total population and in estimates of persons in all labor force categories. However, rates for labor force characteristics remained virtually unchanged. For a further discussion of these changes, see U.S. Department of Labor, Bureau of Labor Statistics, Revisions in the Current Population Survey Beginning in January 1982, Employment and Earnings (Washington, DC: U.S. Government Printing Office, February 1982). a These data represent civilian, noninstitutionalized workers in nonagricultural industries. 10 May 1994 EBRI Special Report & Issue Brief

11 Chart 1 Voluntary and Involuntary Part-Time Workers Aged 16 and Over as a Percentage of All Workers, and Gross National Product (GNP), Percentage $ Billions 20 % $ 6, % 16 % 14 % 12 % 10 % % 8 % 6 % 4 % 2 GNP (billions of 1987 dollars) Voluntary Part-Time Workers (as a percentage of total workers) Involuntary Part-Time Workers (as a percentage of total workers) $ 5,000 $ 4,000 $ 3,000 $ 2,000 $ 1,000 % $ Source: U.S. Department of Commerce, Bureau of Economic Analysis, Survey of Current Business, selected issues (Washington, DC: U.S. Government Printing Office, selected issues); and U.S. Department of Labor, Bureau of Labor Statistics, Employment and Earnings, selected January issues (Washington, DC: U.S. Government Printing Office, selected issues). Note: These data represent civilian, noninstitutionalized workers aged 16 and over in nonagricultural industries. GNP for 1993 represents 1st quarter data only. See tables 1 and 2. Most multiple jobholders worked fewer than 24 hours per week on their second job, but in total they exceeded 35 hours per week so were counted as full-time employees. Thus, there was an increase in part-time jobs without a corresponding increase in the number of persons counted as working part time (Tilly, 1991). 10 However, because the majority of these multiple jobs holders held a full-time job in addition to their part-time job, their overall receipt of work place benefits would not likely significantly differ from those of workers holding only one full-time position. Voluntary part-time workers represented 70.6 percent of all part-time workers in 1993, compared with the 29.4 percent classifying themselves as involuntary part-time workers. Between 1969 and 1993, the voluntary part-time work force grew from 9.0 million to 10 Historically, most multiple jobholders were men working a second job to supplement income from a primary, full-time, job. In 1970, 7.0 percent of all male workers, and 2.2 percent of all female workers, held a second job (U.S. Department of Labor, 1991; Levitan and Conway, 1988). More recently, many more women are working two jobs. The number of women with multiple jobs increased from 636,000 to 3,129,000 between 1970 and By 1991, 5.9 percent of employed women held multiple jobs and 6.4 percent of men held multiple jobs. The majority of individuals with multiple jobs, both men and women, held one full-time job and one part-time job. In 1991, 79.9 percent of men held one full-time job and one part-time job, 14.1 percent held two parttime jobs, and 6.0 percent held two full-time jobs. The corresponding figures for women are 62.2 percent, 35.5 percent, and 2.3 percent, respectively (U.S. Department of Labor, 1991; Stinson, 1990) million, an average annual increase of 2.0 percent (table 1). The involuntary part-time work force increased from 1.8 million to 6.1 million, an average annual increase of 5.2 percent. Recent increases in the involuntary part-time work force have occurred during slowdowns in the overall economy (chart 1 and table 2). For example, the late 1970s low of 3.2 million involuntary part-time workers in 1978, went to a 1980s high of 6.0 million in 1983 following the recession in the early 1980s (table 1). Since 1990, the increase in the number of people employed involuntarily part time has gone from 4.9 million in 1990 (4.5 percent of all workers) to 6.1 million in 1992 and 1993 (5.6 percent and 5.5 percent of all workers). In 1990, 13.6 percent of all workers were employed voluntarily part time, compared with 13.3 percent in Full-time workers accounted for 82.0 percent of the total work force in 1990, falling to 81.2 percent in However, 1982 and 1983 levels of involuntary part-time employment (6.5 percent of total workers in both years) actually exceed those of the 1990s. Thus, while the shortrun trends remain important to our current economy, the more important question is whether growth of the parttime work force as a percentage of all workers will continue in the long run such that it surpasses the levels of the early 1980s, and, if so, what effect this will have May 1994 EBRI Special Report & Issue Brief 11

12 Table 2 Involuntary Part-Time Workers Aged 16 and Over as a Percentage of All Workers; Gross National Product (GNP); and Percentage Change in GNP; 1969 to First Quarter 1993 Involuntary Part-Time Workers GNP Percentage Change Year (as a percentage of total workers) (billions of 1987 dollars) in GNP % $2,891 a , % , , , , , , , , , , , , , , , , , , , , , , st Q , Source: U.S. Department of Labor, Bureau of Economic Analysis, Survey of Current Business (Washington, DC: U.S. Government Printing Office, selected issues). a Data not available. on the U.S. work force, competitive capabilities, and economy as a whole. Some analysts argue that recent increases in involuntary part-time employment (between 1989 and 1992) despite signs of economic recovery are an indication of a continued and more permanent change in the makeup of the U.S. work force from one in which virtually all employees are fully attached to the labor force and to a single employer to one in which the labor force is much more flexible and many workers are employed through alternative work arrangements. Others believe that the signs of economic recovery have been weak, at best, and that, based on past experience, involuntary part-time employment will continue to increase until the economy more definitively improves. And, in fact, as in the past, as the economy has slowly begun to recover, the number of involuntary part-time workers has declined slightly, falling from 6,116 thousand to 6,106 thousand (or from 5.6 percent to 5.5 percent of the total work force) between 1992 and 1993 the first decline since It remains to be seen whether, as the economy continues to improve, the number and percentage of involuntary part-time workers will more definitively continue to decline. Others argue that part-time work, both voluntary and involuntary, is not necessarily an indication of lack of attachment to the labor force at all, and that many part-time workers are as attached to their employer as full-time employees. Thus, fluctuations in part-time employment should not be correlated with a possible more permanent change in the structural makeup of the U.S. work force. One reason for the increase in the number of part-time workers is simply the fact that there are more workers in the labor force. Changing demographics may also have played a role in the increase in the number of part-time workers. Many employees elect to remain in the labor force past the traditional retirement age but on a part-time basis, allowing them to ease into full-time retirement. 11 In addition, as the pool of entry level workers declines, employers increasingly look to older workers to meet their part-time worker needs. The enormous growth in the labor force participation of 11 A widely held, but substantially inaccurate, perception is that retirement generally occurs as an abrupt event. In reality, many workers leave the work force gradually. For a discussion of the work and retirement patterns of older Americans, see Ruhm, May 1994 EBRI Special Report & Issue Brief

13 Chart 2 Percentage of Part-Time Workers, by Industry, 1992 Self-Employed 12% Services 29% Public Sector 13% Agriculture 2% Construction 2% Finance, Insurance, and Real Estate 3% Manufacturing 4% Transportation, Communications, and Utilities 2% Retail Trade 31% Wholesale Trade 1% Note: See table 7. women during the past half century has provided another source of part-time workers. 12 Although most of this growth has been in full-time employment, a substantial number of women are employed part time. The increased number of part-time workers may also partly result from the demands of employees for more flexibility. Among the variety of reasons part-time workers choose reduced hours are to make time available for study, avocations, and family commitments, and to ease into full-time retirement. 13 Another reason often given for the increased number of part-time workers is the disproportionate growth of services and retail trade industries in which part-time work has always been prevalent 14 in relation to the rest of the U.S. economy. The proportion of all fulltime equivalents (including both full-time schedules and part-time schedules converted to a full-time basis) represented by service industry workers increased steadily from 14.1 percent in 1970 to 26.1 percent in 1992, while the proportion represented by manufacturing industry workers decreased from 28.6 percent in 1970 to 17.1 percent in The proportion of service industry workers surpassed that of the manufacturing industry workers beginning in While the average annual increase among all workers was 1.4 percent between 1980 and 1992, manufacturing workers decreased by 0.9 percent and service industry workers increased by 4.0 percent during this period (U.S. Department of Commerce, 1992b and 1993). 15 Thus, while some of the increase in the number of part-time workers may be due to industry shifts, given the extensive shift toward industries that hire part-time workers, it is surprising that the proportion of the total work force that is part-time has not increased more dramatically. An analysis of productivity growth across industries may shed light on this phenomenon. Use of Part Timers Industry Two industries retail trade and services are the primary employers of part-time workers. Many of the positions in these 12 For example, the labor force participation rate among women aged was 34.0 percent in 1942; in 1991, the rate was 75.0 percent. For a further discussion of population and labor force trends, see Anzick, 1993b. 13 Interest groups such as New Ways to Work (San Francisco) and Catalyst (New York) have encouraged the expansion of part-time opportunities and have provided assistance to organizations to expand such jobs (Pierce et al., 1989). The Association of Part-Time Professionals promotes part-time employment in upper-level jobs. Part-time work is viewed by its promoters as a means of providing a flexible lifestyle and a balance between work and the rest of life. 14 For example, 28.8 percent of those in the service industry worked part time in 1992, and 41.2 percent of those in retail trade were part-time workers (table 7). By comparison, only 5.8 percent of workers in the manufacturing industry were part time. For further discussion, see the section entitled Use of Part Timers on this page. 15 For a further discussion of industrial shifts, see Anzick, 1993a. May 1994 EBRI Special Report & Issue Brief 13

14 Percentage Chart 3 Industry Group, by Percentage of Part-Time Workers, % % 29% 27% % 13% 0 Total Retail Services Agriculture Finance, Insurance, and Real Estate Note: See table 7. 10% 9% Construction Wholesale Transportation, Communications, and Utilities 6% Manufacturing industries require only quickly learned and readily transferable skills; thus, it is not as crucial to hire fulltime, specialized workers. In addition, extensive use of part-time workers in these sectors results, in part, from the need of these industries to offer services to customers during evenings, weekends, and other peak times. In goods-producing industries, where operations normally may take place in one or more 8-hour shifts, and in which job-specific skills are required, the use of part-time workers is less common (Norwood, 1988). The retail trade and service industries employed 38 percent of all workers and 60 percent of all part-time workers in 1992 (chart 2 and see table 7). Within each industry, 29 percent of service workers and 41 percent of retail trade workers worked part time (chart 3). These percentages are higher than the overall rate of 22 percent. Firm Size Small firms were more likely than large firms to employ part-time workers. While 82 percent of workers in firms of 1,000 or more worked full time, 18 percent worked part time (chart 4). By contrast, 67 percent of workers in firms with fewer than 10 employees worked full time and 33 percent worked part time. In addition, among all part-time workers, most worked for small firms. Over one-half (54.4 percent) of all part-time workers were in firms with fewer than 100 employees (see table 8). Thirtytwo percent were in firms with fewer than 10 employees, compared with 30 percent in firms with 1,000 or more employees. However, in firms with 25 or more employees, the proportion of full- to part-time workers remains fairly constant with approximately 82 percent of employees working full time and 18 percent working part time. Economies of scale, as well as employment tradition, may have been influential in larger firms use of part-time workers. Such firms tend to be older, with an established culture of lifetime employment and limited use of part timers. Small firms, on the other hand, tend to be younger and, because of their small size, generally have less freedom in assigning a work force and are accustomed to the just-in-time concept of resource management, including the hiring of workers. With the restructuring of American industries, including both industry shifts and downsizing, it is possible that the composition of the work force in large firms could come to more closely resemble that of small firms, with both types turning more toward a contingent work force and alternative work arrangements. Unions In recent years, union membership and the number of individuals represented by unions (in absolute numbers) has generally declined for full-time workers and increased for part-time workers (table 3). The percentage of part-time workers represented by unions declined from 9.0 percent in 1984 to 8.3 percent in However, this decline is less steep than the decline for full-time workers (24.5 percent in 1984 to 19.9 percent in 1993). 14 May 1994 EBRI Special Report & Issue Brief

15 Percentage Chart 4 Firm Size, by Percentage of Full- and Part-Time Workers, % 80% 70 % 78% 75% 80% 84% 82% 82% 60 % 50 % 40 % 67% Full Time Part Time % 30 33% 20 % 10 % 22% 25% 20% 16% 18% 18% 0 % All Workers Fewer than ,000 or more Firm Size Note: See table 8. Characteristics of Part Timers Overall, most part-time workers classify themselves as voluntarily part time, that is, they want to work part time. 16 In 1992, there were 19.3 million voluntary part-time workers (representing 67 percent of all parttime workers) and 6.8 million who considered themselves involuntary part time (23 percent of all part-time workers) (chart 5). Age and Gender Part-time work is a major form of employment for three demographic groups in our society: younger workers (aged 16 17), older workers (aged 65 and over), and female workers. In 1992, the majority of people aged (56 percent) and 65 and over (85 percent) were not in the labor force (chart 6). However, of the 2.9 million workers aged who were employed in 1992, 84.4 percent were part time (chart 7). Of the 4.6 million workers aged 65 and over who were employed, 56.3 percent were part time. By contrast, 13.4 percent of 16 See Technical Notes on page 36 and Glossary of Terms on page 38. workers aged and 14.6 percent of those aged were part time. Thus, as chart 7 depicts, part-time work, for many, is part of a work life cycle, with individuals working part time when they are younger, then moving into full-time positions throughout their prime working years and, finally, as retirement nears, returning to part-time employment. In addition, the service economy s demand for an inexpensive, flexible labor pool, in conjunction with the growth in the service industries, has precipitated opportunities for part-time employment among high school students and older workers. Various public opinion surveys conducted by Louis Harris, the American Association of Retired Persons, and others have indicated a high level of interest in part-time work among older citizens (Kahne, 1985; Golden, 1992). In one survey of year-old men and year-old women, 54 percent of those not working but who would like to work indicated a desire to work part time. While the paucity of jobs that bridge career positions to full-time retirement may represent a barrier to this group s continued employment (Ruhm, 1991), growth of the service industries may provide opportunities to fill this demand. Of all part-time workers over the age of 16, 35 percent were male, and 65 percent were female (chart 8). Among all part-time workers, there was little difference between the percentage of females and males May 1994 EBRI Special Report & Issue Brief 15

16 Table 3 Wage and Salary Workers by Full- and Part-Time Status and Union Affiliation, Full-Time Workers Part-Time Workers Members of Represented Members of Represented Year Total unions a by unions b Total unions a by unions b (thousands) ,912 16,074 18,376 17,282 1,266 1, ,002 15,717 17,816 17,518 1,280 1, ,727 15,698 17,748 18,176 1,277 1, ,836 15,670 17,567 18,467 1,243 1, ,692 15,773 17,753 18,716 1,229 1, ,553 15,701 17,683 18,926 1,259 1, ,082 15,422 17,469 18,822 1,318 1, ,525 15,179 17,095 19,261 1,390 1, ,143 14,975 16,886 19,545 1,415 1, ,211 15,171 16,999 19,856 1,427 1,647 (percentage) % 21.5% 24.5% 100.0% 7.3% 9.0% Source: U.S. Department of Labor, Bureau of Labor Statistics, Employment and Earnings (Washington, DC: U.S. Government Printing Office, selected January issues). a Data refer to members of a labor union or an employee association similar to a union. b Data refer to members of a labor union or an employee association similar to a union as well as workers who reported no union affiliation but whose jobs were covered by a union or an employee association contract. Chart 5 Part-Time Workers Aged 16 and Over, by Voluntary and Involuntary Part-Time Work Status, a 1992 Other 10% 2.8 million Involuntary 23% million Voluntary 67% million million 28.9 Million Part-Time Workers 28.9 Million Part-Time Workers Note: See table 19. a The March 1993 CPS includes four response categories for the main reason an individual worked part time: could only find part time job, slack work (involuntary part time), wanted part-time (voluntary part time), and other. The other category is not further delineated in the survey. 16 May 1994 EBRI Special Report & Issue Brief

17 Chart 6 Percentage of Individuals within Selected Age Groups, by Full- and Part-Time and Nonworker Status, 1992 Percentage 100 % 90 % 31% 56% 19% 85% 80 % 70 % 60 % 50 % 40 % 30 % 15% 54% 37% 15% 65% Nonworkers Part-Time Workers Full-Time Workers 20 % 10 % % 0 8% 7% 6% Total Aged Aged Aged 65 and over working part time between the ages of 16 to 24 and 45 and over. Between the ages of 25 and 44, the difference was more pronounced. Nine percent of all part-time workers were males aged 25 44, while 26 percent were females aged These differences may be due, in part, to the fact that these are important years for childbearing and rearing. Income Unpublished data from analysis of the CPS show wage differentials between full- and part-time hourly workers and between men and women who work full- and parttime on an hourly basis (table 4). Median hourly earnings for part-time workers were $5.55, compared with $8.89 for full-time workers in 1993 (the minimum wage was $4.25). The median hourly wage for part-time workers was 62 percent of the hourly wage of the median full-time worker, and percent of the minimum wage. Since 1973, the ratio between part- and full-time workers hourly earnings has shown little change, with a low of 58 percent in 1975 and a high of 63 percent in While these data include only individuals paid on an hourly rate, they do not reflect individual workers characteristics, such as education level, race, and industry. It is likely that the difference between partand full-time workers hourly earnings would be reduced when taking these factors into account. Median hourly earnings for men working part time were $5.19 in 1993, compared with $9.89 for men working full time; thus, the median hourly wage for parttime male workers was 52 percent of the median hourly wage of full-time male workers (table 4). This difference was much less pronounced among women. Median hourly earnings for part-time female workers were 72 percent of those for full-time female workers in Female full-time workers earned approximately $7.94 per hour, compared with $5.75 for female part-time workers. However, while the ratio of hourly earnings of male part-time to full-time workers has remained fairly constant since 1973, the ratio has fairly steadily declined for female part-time and full-time workers (from a high of 83 percent in 1973 to a low of 72 percent in 1993). Education In 1992, approximately one-quarter of all part-time workers (24.1 percent) had not completed high school, compared with 12.0 percent of full-time workers (see table 14). These percentages may reflect a high number of high school students, as well as high school dropouts among part-time workers. Family Type Nearly one-half (46.1 percent) of all part-time workers in May 1994 EBRI Special Report & Issue Brief 17

18 Percentage 90 Chart 7 Age, by Percentage of Part Time, Voluntary Part-Time and Involuntary Part-Time Work Status, Part-Time Involuntary Voluntary Total Aged Aged Aged Aged Aged Aged 65 and over Note: See table 9. Chart 8 Part-Time Workers, by Age and Gender, 1992 Percentage % Male Female % 26% % 15% 9% 9% 0 4% 4% 2% 3% 6% 5% 4% Total Aged Aged Aged Aged Aged Aged 65 and over Note: See table May 1994 EBRI Special Report & Issue Brief

19 Table 4 Median Hourly Earnings of Workers Paid Hourly Rates, by Gender and Full- and Part-Time Status, Annual Averages, Ratio of Hourly Earnings of Full Time Part Time Part- to Full-Time Workers Year a Total Men Women Total Men Women Total Men Women (dollars) (ratio) 1973 $3.36 $4.00 $2.46 $2.04 $2.06 $ Source: Tom Nardone, U.S. Department of Labor, Bureau of Labor Statistics, unpublished data from the Current Population Survey. a Data for 1973 through 1978 refer to May; 1979 data forward represent annual averages were married women (see table 15). About one-third (33.5 percent) of all married female workers were part time, while 13.3 percent of all married male workers were part time. The percentage of married women working part time increased to 38.0 percent for those with children, while the percentage of married men working part-time decreased to 10.8 percent for those with children. Race and Origin Whites were somewhat more likely to be working part time than either blacks or Hispanics. Just over 22 percent (22.3 percent) of whites indicated they worked part time in 1992, compared with 19.7 percent of blacks and 19.9 percent of Hispanics (see table 12). However, whites were less likely to be working involuntarily part time than either blacks or Hispanics. Among white workers, 4.6 percent considered themselves involuntary part-time workers, compared with 7.2 percent of blacks and 7.9 percent of Hispanics. Among white workers reporting income of less than 100 percent of the federal poverty level, percent were involuntarily part time. For blacks in this same category, the percentage was 20.9, and for those of Hispanic origin, the percentage was Federal poverty thresholds vary by location and family size. In 1992, weighted average poverty thresholds were $6,810 for one person, $9,190 for two persons, $11,570 for three persons, and $13,950 for four persons. Poverty guidelines are established by the U.S. Department of Health and Human Services and are used to determine individuals and families eligibility for various federal and nonfederal programs. May 1994 EBRI Special Report & Issue Brief 19

20 Full-Year/Part-Year Work Status Seasonal Employment Among part-year, full-time employees in 1992, the weeks worked category that included the highest percentage of workers (69.0 percent) was weeks (see table 16). However, for part-time workers 13 weeks or less was the category that included the highest percentage of workers (55.4 percent). Part- and full-year data may provide some insight into the number and proportion of workers who are seasonally employed. However, the CPS does not specifically query respondents regarding seasonal employment. Weeks Unemployed The number of weeks a part-time worker was unemployed was strongly associated with voluntary and involuntary part-time work status. For example, among part-time workers indicating no weeks of unemployment during 1992, 73 percent were voluntary part-time workers and 17 percent were involuntary (chart 9). By comparison, among part-time workers indicating 13 or more weeks of unemployment, 31 percent were voluntary and 61 percent were involuntary. While voluntary part-time workers were less likely to experience unemployment than involuntary workers, part-time workers as a whole were more likely than full-time workers to be vulnerable to periods of unemployment. Nearly 88 percent (87.9 percent) of full-time workers experienced no unemployment in 1992, compared with 82.1 percent of all part-time workers (see table 13). Six and one-half percent of all full-time workers experienced 13 or more weeks of unemployment in 1992, compared with 9.7 percent of all part-time workers. Benefits of Part Timers Legally required benefits that must be provided to almost all workers include employer contributions to Social Security, unemployment insurance, and workers compensation insurance. In addition, the more recently enacted Family and Medical Leave Act covers most employers of 50 or more employees. Individuals receive Social Security benefits based on the number of quarters they worked in covered employment. In order to receive the maximum benefit, an individual must generally have earned a minimum of 40 quarters of coverage (10 years). Quarters of coverage are earned by meeting a minimum earnings threshold ($590 or more per quarter in 1993). States may require recipients of unemployment insurance to meet a minimum earnings threshold and to be available for full-time work. A majority of states also include an additional minimum earnings test for the last three months of employment (durivage, 1992). The 1993 Family and Medical Leave Act, which became effective August 5, 1993 for most employers, covers workers who worked for an eligible employer for at least 12 months (or 52 total weeks) before taking leave. They must have worked at least 1,250 hours (an average of 24 hours per week) for the employer during the 12 consecutive months immediately before the leave. 18 The major voluntary benefits pension and health insurance are regulated if they are offered. Although employers are not required to offer these benefits, in certain circumstances they must comply with 18 For a further discussion of the Family and Medical Leave Act, see Saltford, In 1974, Congress passed the Employee Retirement Income Security Act (ERISA), which set up specific pension participation standards. Generally, ERISA requires that a worker cannot be excluded from a plan because of age or service if he or she is aged 21 or over, has worked for the employer at least one year, and works 1,000 or more hours annually. Individuals who meet these criteria are more likely than workers in the general work force to accrue pension benefits and are classified as the ERISA work force. 20 May 1994 EBRI Special Report & Issue Brief