Contract Employment: Measurement and Implications for Employer–Employee Relationships

Abstract

This article utilizes a new nationally representative survey, executed in January 2020, that measures non-standard work. The author estimates the incidence of contract company employment and freelancing and describes who goes into non-standard employment. He then studies earnings and access to employer-provided training among contract company employees—the largest and most mis-measured group of non-standard workers. Training is important because it affects wage growth and career trajectories and also gives insight into the evolving character of employment relationships. Findings indicate that contract company employees face an earnings penalty but that considerable heterogeneity occurs within this category. The analysis of multiple forms of formal training finds that contract company employees receive less training than do standard employees even after multiple controls. Informal training is more textured due to the nature of social interactions inherent in its availability. Throughout the analysis, racial and ethnic disparities are apparent.