The end of longterm security for workers

As companies move full time roles to contractors — health, vacation, and retirement benefits disappear

In a recent Wall Street Journal article, The End of Employees, revealed companies often outsource 20–50% of their workforce and the trend is only increasing. Some of the leading firms include Bank of America, Verizon Communications, Procter & Gamble and FedEx.

A trend that started with outsourcing services, such as cleaning and mail delivery, has turned into a scenario where airlines only employ customer facing employees and don’t even own the engines on their own planes. Within 10 years Accenture estimates that a number of large companies will have no employees beyond the C-Suite — creating a company of contractors.

While companies are appearing ‘more efficient’ because they ‘employ’ less people, this move comes at the neglect of contractors. Contractors are not entitled to benefits including healthcare, vacation, training benefits, pension, and — at times — advance notification or cause for termination.

The first roles usually outsourced are the ‘blue collar’ jobs, the very workers that benefit most from the safety net of benefits. By workers increasing there education by getting degrees, certifications, or even taking individual courses at colleges like those offered through Caila are all ways to increase job security for full-time employment, but this is still not a guarantee.

As companies evolve and lean more heavily on contractors we need to consider the impact on workers and our country. With an increasing number of citizens without healthcare, retirement services, or basic training to keep up with the adapting economy — this will only weigh on our government and erode the future competitiveness of our country.

By Sergio Marrero

Co-Founder, Caila