The latest report from the government shows that employers are starting to put more people on the payroll again. But millions of Americans who are earning an income are doing so without the benefits or security that once came standard with most jobs.
Lance Anderson, 58, is one of them. Since losing his job as a graphic designer three years ago, he's been making a living as a freelancer.
At first, Anderson enjoyed the freedom of working from the studio in the back of his Bay Area home. But as more designers were laid off and competed for freelance jobs, work became tougher to find. He's getting by, because his wife is employed, but health insurance costs $355 a month and some days sitting alone in his studio, he feels like he's going mad.
"It's tougher than it used to be," he said. "But it's way easier to find freelance work than it is to find a job."
Deprived of steady work, more people are becoming independent contractors, or freelancers, giving up the benefits of being a full-time employee for the chance to at least earn a paycheck.
In 2005, the federal government estimated there were more than 10 million independent contract workers, or 7.4% of the workforce. That number has almost certainly risen during the economic downturn, experts say, as companies shifted some work from employees to contractors to cut benefits costs and make it easier to jettison staff when business slowed.
Workers may not like it, but at a time of high unemployment -- in California, the jobless rate is 12.5% -- many have no choice but to take whatever work they can get, even if that means paying for their own health insurance and forgoing a 401(k) and life insurance plan.
Labor advocates are concerned that the trend, if unchecked, will lead to a widespread retreat in the benefits American workers have come to expect, including paid vacations, employer-paid health insurance and money for retirement.
Companies that hire independent contractors are not required to pay them a minimum wage or overtime pay. The companies don't pay or withhold payroll taxes, so it is more difficult for the IRS to collect taxes from the workers, which deprives Medicare and Social Security of needed funds. And a retirement plan or health insurance? Forget about it.
