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The End of 9-to-5

David Callahan

Dig deep enough into the new jobs data for May and you'll find this startling figure: 116 million. That's the number of Americans who were employed at full-time jobs last month. 

Why is that so startling? Because the total potential U.S. labor force is 245 million people. 

We've all heard that the labor participation rate has fallen in recent years -- of those 245 million people, just 63.4 percent are in the labor force, the lowest level since 1979 and down from 66.4 percent ten years ago. In total, 155 million people were said to be the labor force last month, with 143 million actually employed. 

The fact that 100 million Americans aren't working is pretty shocking, and I've written here often about how the official unemployment rate way understates the number of those folks who wish they had jobs. Once people stop looking for work, the government basically stops counting them as unemployed.

But the picture is even more disturbing when you look closely at the 143 million people who have jobs. As I noted above, only 116 million of these are full-time employees -- which means they work more than 35 hours a week and may qualify for whatever benefits are offered by their employers. The other 27 million people with jobs are part-time workers, many voluntarily so, but a third are part-time simply because they can't get more work. 

The 143 million figure also includes 9.3 million Americans who were self-employed last month. 

All in all, we're talking about a whole lot of people -- even those who do have jobs -- who are de-linked from the traditional world of 9-to-5 work. There are some upsides to this trend in that a great many Americans don't like going to a workplace every day, which requires some kind of commute and involvement in hierarchical organizations that too often are dysfunctional. 

But here's the problem with so many people floating around: The U.S. social insurance system is still largely work-based. Most people with health insurance get it through their jobs, as do most people with retirement accounts. Both of these employee benefits are tax deductible, meaning they are not counted as taxable income. Also, you only get unemployment insurance if you lose a regular job. And even Social Security, which is a universal program, is subsidized by employers, who pay half of their workers' payroll tax. If you're self-employed, you pay all your payroll taxes by yourself. If you're not working, you're not building up anything in Social Security and will only qualify for low benefits. 

America has become a "free agent nation," in Daniel Pink's memorable phrase, yet we still have an "Organization Man" social insurance system left over from the mid-20th century. That's not good, and it helps explain -- among other things -- why so many people face very bleak retirement prospects with minimal nest eggs. 

Fortunately, there is a comprehensive policy agenda out there for bringing our social insurance system in line with the changed work world. I laid out some of that agenda in a 2012 American Prospect article that you can read here. The Freelancer's Union, founded by Sara Horowitz, also advocates for reforms -- and, more importantly, is creating alternative structures for health insurance and other benefits. 

The world of 9-to-5 is ending. It's time to truly adjust to that fact. Of course, since this nation still hasn't adjusted to the large-scale entry of women into the work force a few decades ago -- say, with affordable childcare -- maybe I'm hoping for too much here.