Why Being a Part-Time Worker Is Miserable

Bloomberg View , July 29, 2014

The worst thing about being on jury duty isn’t actually serving on a jury. It’s having to check in every day -- possibly several times a day, depending on your local system -- to see whether you’ll be needed. You can’t plan either your work or your personal life. Your schedule is unpredictable and completely out of your control.

For many part-time workers in the post-crash economy, life has become like endless jury duty. Scheduling software now lets employers constantly optimize who’s working, better balancing labor costs and likely demand. The process demands enormous flexibility from part-time workers, sometimes requiring them to be on call all the time without knowing when they’ll work or how much they’ll earn. That puts the kibosh on the age-old strategy of working two or more part-time jobs to make ends meet. As my colleague Megan McArdle writes, “No matter how hard you are willing to work, stringing together anything approaching a minimum income becomes impossible.”

The problem, she concludes, is the weak job market: "As long as the demand for low-skilled labor significantly lags the supply, workers will continue to struggle.” It’s an obvious conclusion. But it’s missing something important.

Regardless of economic conditions, the deal between employers and workers has two components: money, including any benefits, and working conditions, including how well hours match worker preferences. The weak job market affects the total value of that package, not the mix between the two parts.

When an employer demands unpredictable work hours, it’s making the deal worse. It can get away with a worse deal because of the bad economy, but what about the mix? If unreliable schedules are so burdensome, why don’t workers switch to jobs with better schedules but lower pay? Why don’t competitors offer such options?

One possibility is that, despite the burdens, workers actually prefer more money to predictable hours. Some surely do. But others clearly don’t. For people who want a second job, not knowing their working hours isn’t just inconvenient. It’s costly.

The alternative explanation is that employers can’t offer, and workers can’t take, lower wages in exchange for better hours. The minimum wage sets a legal floor.

To see how this works, consider a large group of part-time retail workers who aren’t complaining loudly about irregular schedules: pharmacists.

“Does a highly-paid, relatively short-hour, moderately high education, majority-female occupation sound too good to be true? It is true and the field is pharmacy,” write Harvard labor economists Claudia Goldin and Lawrence F. Katz in a paper calling pharmacist “the most egalitarian of all professions.” As big retail chains expanded, replacing independent pharmacist-owned shops, they offered part-time work at relatively high wages. As a result, women flooded into the field. “Because of the extensive work flexibility and low pecuniary penalty to short hours, female pharmacists with currently active licenses take little time off during their careers even when they have children,” the economists write.

But if demanding unpredictable hours from cashiers and clerks is good for business efficiency, why isn’t the same true for pharmacists, who work short hours in similar retail environment?

The most likely explanation is that pharmacists, unlike cashiers and clerks, can legally trade money for more predictable hours. Their median wage is $58 an hour, which leaves a lot of wiggle room. Many clerks and cashiers, by contrast, make minimum wage. They can’t legally go any lower. Even those who make more than the legal minimum often have wages tied to it. It’s easier for an employer to adjust schedules than to cut wages. So when the economy softens, the only way to reduce labor costs is to tinker with schedules.

If this explanation holds, we can expect higher legal minimums to lead to even more demands for irregular schedules, as workplaces that once offered better schedules at lower wages lose that competitive option. And if calls for regulating how much flexibility employers can demand also pass, the only way to accommodate slack business will be to hire fewer workers.

In that sense, McArdle is right. More demand for low-wage workers would lead to better job offers, whether the improvement came as higher pay or better conditions.