Should our company hire temporary workers or hire new workers to handle increase demand for our product?

Abstract

This paper focuses on the comparison between the temporary and permanent workers in an organization in order to find out the correct choice between the two, when a company needs to increase the production due to the increase in demand. Based on the cost, culture, and efficiency characteristics of the labor lying in both the categories, the possible recommendation for such a company is given in the latter half of the writing, which supports the temporary worker hiring for the issue.

Should our company hire temporary workers or hire new workers to handle increase demand for our product?

Definition

In the last decade the trend of temporary employment has rose in the United States. The temporary employment has grown drastically with an average of 30000 jobs per month; all because of the business that was hit recession took time to hire new employees. Though, many researchers concluded that the increase in the employment is just for the time being and will not last forever. In a survey that was conducted recent by the economist intelligence unit, there was a group of 480 executives out of which 6 percent planned the maintenance of the organization by hiring workers from external sources.

In the terms of labor law, the workers that come under the category of temporary workers are categorized in the broad term known as contingent labor, and the total U.S. workforce comprises of 50% of the contingent workforce.

For the employers perspective, to adopt the strategy of hiring contingent labor forces proves that hiring temporary employees helps the organization to cut costs. The top of the line benefits are:

Fixed Cost Reduction

Increase in the flexibility

Increase in the productivity

In the wider picture, the contingent workforce may be very productive but it has its own share of drawbacks near some researchers. Some studies prove that the contingent workers are not much loyal to the company, which increases the personal profits thinking. Contingent workforce has a everlasting competition and sort of rivalry with the permanent employees depending on the organizational structure of the company. Time to time company orientation and introduction to the tasks contingent workers have to do, will eventually decrease the productivity of the permanent workers, with a fear for the permanent ones that they might get fired as the new temporary worker is performing extra.

On the part of the contingent workers, the lack of job security in combination with the social isolation within the company may be termed as the causes of stress for the temporary workers. In many studies, it is found that the job satisfaction level of the companies that have the traffic of contingent workers is very low as compared to the companies who only have permanent employees. This may also rise to the point that the productivity gain that is achieved by incorporating the external temporary worker can be cancelled out by the unhappiness, stress and de-motivation of the permanent ...