A friend emailed me late last week with a question: Are temporary jobs replacing permanent jobs as the standard in the workplace?

The answer is it depends on how you define a temporary job.

The use of temporary jobs is definitely increasing as companies work to keep their flexibility. Employers learned a lesson during the past recession: You don’t want to be caught with a huge overhead when the economy starts faltering.

But there is more to it than fear and skepticism over the state of the economy. Employers with huge swings in workload have always relied on temporary employees – think seasonal workers, substitute teachers, etc. An increase in temporary hiring is traditionally a sign that an economy is heading out of a recession.

Here are several other trends I’m seeing with the use of temporary employees:

  • Temp jobs are the new permanent in areas where skills can grow obsolete, the workload varies, or companies don’t feel that they can commit to hiring permanent staff. IT, some types of engineers, or any company that is not sure of the economic recovery fit this category. Temp is another way of saying contract, and there are lots of contract jobs out there. The advantage to the company is flexibility and lower cost.
  • The cost of benefits and increased regulation is also making temporary employment a more cost effective option – especially for smaller companies. Benefits add, on average, 30 percent to the cost of a salary. Temporary employees must cover that cost on their own or through another source. This provides employers with much needed flexibility in a global economy where competitors pay their staff considerably less.
  • There are jobs where you won’t see temps. I don’t think retail will move to a completely temp workforce despite their long-history of staffing up for peak times like Christmas. I don’t see a lot of temporary cops or firefighters or public school teachers or skilled labor even though there are pockets of times when they need additional coverage.
  • There are jobs where temp/contract employees and full-time employees intermingle seamlessly. Large technology companies have used contract employees as part of their teams for years. Many – perhaps most – hospitals use contract/temp staff to fill in and supplement their permanent staff coverage. A few months back I sat next to a nurse who flies from DFW to Albuquerque two times per month to work as a temp at the hospital in Santa Fe. He is paid very well by the hospital and his family lives in the area.
  • Temp executives is a growing industry, but no one really wants a contract CEO for the long haul. You can have a permanent temp/contract CFO or maybe CIO for a small company, but there will come a time when you need someone who will lead that function every day. It could be a contract person that you hire from a professional group, but you still want the same person there every day.
  • Sometimes the definition of temp employee is misleading. That was true in the past and is even more so today. My aunt was a Kelly Girl years ago. She never worked more than a couple of weeks in any assignment, and yet she received benefits and was an employee of Kelly Temp Services. In that regard, she was like a consultant who went from assignment to assignment.

Yes, there are challenges with building a cohesive team, managing risk, and ensuring that your temp can carry out the customer experience that you want. But for many organizations, the opportunities clearly outweigh the risks.

Call them freelancers, temps, contractors, or consultants – the use of resources that don’t require a permanent commitment, don’t require benefits from you, and are responsible for maintaining their own competency is something that is here to stay except in core positions that must be maintained internally.

Here’s what this means for you:

  • You will have unprecedented flexibility if you are in an “in-demand” profession, very good at what you do and maintain your skill set.
  • You are totally responsible for maintaining your competency and employability. Every day your clients get to choose whether you come back the following day. You can no longer coast.
  • Your employer will expect you to deliver value that exceeds the cost of keeping you in a permanent position. Your job is to prove that value or run the risk of being replaced by a contract person, temporary replacement, or even outsourcing.

Every day, your customers ask three questions:

  • Why you?
  • Why now?
  • What makes you relevant and important to me?

Your employers are now asking the same question.