As the recession continues to limit small business spending power, a trend has emerged in which employers are seeking more part-time workers, many of whom are virtually strangers.
Ray Madronio needs more breathing room. His startup, Local Bigwig, based in New York City, faces the challenges of space twofold: in square feet and in budget. The offices, which are located in the NYU-Poly Incubator program in SoHo, only offers about 50 square feet per employee – about the size of a small bathroom each. That's why Madronio decided to tap the resources of part-time, virtual employees, an emerging trend among startups. It was cost effective, required little to no space, and gave him the flexibility to hire the people he wanted, wherever they were.
'We're able to have more people working on the company,' he says about his three virtual workers, who mostly perform social media and blogging tasks on a 9 a.m. to 3 p.m. schedule. 'It's great.'
Working remotely is nothing new – telecommuting has been around for as long as reporters dictated news stories over the phone – but the strains on the economy have precipitated a rise in the amount of part-time workers, many of them working virtually. In fact, a 2010 survey of 330 U.S. employers by Right Management, a talent and career management consulting firm, found that 45 percent of businesses are increasing their amount of virtual workers.
Over the past 10 years, the amount of workers who indicate they are working part-time for 'economic reasons' (i.e. they would prefer to be full-time), has exploded from 3.1 million in October 2000, to over 9.1 million in October 2010, about a 300 percent increase, according to the Bureau of Labor Statistics. This statistic is an indication of a sluggish economy and a downturn demand in labor.
According to Karen Kosanovich, an economist with the Bureau of Labor Statistics, there's been a sharp increase in involuntary part-time work since the onset of recession. 'One component of this,' she says, 'is that the proportion that are working part-time could not find a full-time job.' Another explanation for the rise of part-timers is 'slack' work, or a reduction in the amount of hours an employer gives his or her employees.
For some, virtual part-time work has created a boon for business. Urban Interns, for example, is a New York startup that offers part-time staffing solutions for small businesses. Launched in February 2009 – in the thick of the recession - the site has thrived. The founders of the company say that virtual work is becoming more and more important - and perhaps profitable - for their business.
'We've seen the rise of the virtual position, either locally or across the country,' says Cari Sommer, the founder of Urban Interns. 'The economic benefit (of part-time work) is from the ability to staff up and staff down as you require, and people have embraced this flexible concept.'
The site, which was named by BusinessWeek as one of America's Most Promising Startups of 2009, recently completed a round of funding, and has expanded to 12 cities nationwide, including Boston, Philadelphia, Chicago, Austin, Los Angeles, and Seattle. They've also rebuilt the site from scratch, which has helped them deal with the large volume of inquires. "Pretty early on, we saw something interesting, which was business owners from across the county looking to find totally virtual help," says Sommer, noting that "a lot of tasks lend themselves to virtual work."
The rise in part-time work and virtual work are mostly based in online marketing and social media, adds Sommer. 'What we see is a ton of social media positions. In fact, we've seen social media positions rise 60 percent in the last six months.'
It makes sense, then, that many of these part-time social media workers are young. In a report titled 'Involuntary Part-Time Work on the Rise' released by the Bureau of Labor Statistics in December 2008, young workers are disproportionately represented in the amount of part-timers seeking full-time jobs. 'In general, workers under age 25 are overrepresented among those employed part-time for economic reasons,' the paper notes. 'In the third quarter of 2008, persons aged 16 to 24 accounted for about 25 percent of all workers employed part-time for economic reasons while representing just 14 percent of all employed workers.'
Part-time isn't always a permanent solution, and when the economy gets back on track, many employers hope to offer full-time positions – or at least more hours – to its employees.
'It is our intention to bring on a lot of these guys full time,' notes Madronio. 'Once finances are in better shape.'