Part-timers Are Good Business

Part-timers Are Good Business

By Bill de Decker

November 1999

When I was in high school, the only people who had "part-time" jobs were my fellow students. Anybody who had a "real" job was employed full-time. And when I got out of college, I too gotone of those "real" jobs as soon as I could. In the 35+ years since then, how things have changed! These days, it seems that the folks with the full-time jobs are in the minority and part-time jobs are everywhere and come with a bewildering array of names. Whatever they are called, the question for today's manager is where and how part-time help can help you and your operation.

There are really only two reasons for using part-time employees — the first is to save money and the second is to get better qualified and often more loyal employees. Let's take a look at each.

Saving money
There are several ways in which a part-time employee can save money for your organization. The first is where there is more work than can be handled by one person (or two or three), but less than can be handled by two (or three or four). Full-time employees are paid on the basis of 2,080 work hours per year. Unfortunately, the tasks that a department must accomplish seldom add up to a whole multiple of 2,080, or even close to it. For example, consider a department that generates 5,000 hours of work in a year. This is equivalent to about 2.4 employees. Many managers will play it safe and simply assign three people. This works, but costs more than needed. Alternatively, a manager can assign two full-time personnel and one part-time person. The savings can be significant, as can be seen from the following example. Assuming the full-time people are paid $15 per hour plus payroll taxes and benefits and the part-time person is paid $20 per hour plus payroll taxes, the cost comparison will show net savings of over $20,000. (See Table 1).

Another example of significant savings occurs when a highly skilled, full-time employee is replaced by a lower skilled, part- time person. Two things happen. The first is the savings that occur when replacing someone who makes $25 per hour with someone who makes $12 per hour. The second is that the highly skilled technician is now available for a revenue producing assignment. Also, the technician will probably get higher job satisfaction — most technicians assigned to mowing lawns, sweeping hangar floors and painting walls don't much like these jobs.

Some managers might say that these highly skilled people are already being paid, so, if they have nothing to do, then it doesn't cost a penny to have them mow the lawn, etc. One obvious question at this point is "Why do these people have nothing to do?" After all, it is management's job to make sure there is enough work for all.

Getting better people
Getting better people by hiring part-time people sounds like a paradox. However, the standard work week of 40-hour week between 8 a.m. and 5 p.m., Monday to Friday, removes a substantial number of people from your potential work force. This group includes many highly qualified, highly motivated people, who for a variety of reasons have no interest in working full- time or a standard work week. Who are some of these people? One group consists of men and women who for family reasons cannot commit to a nine-to-five week, retired people, and people who work elsewhere and want to supplement their income. For some, the relative freedom and flexibility of a part-time job is more important than the exact income.The first time I ran into this was 15 years ago at a previous employer when we were looking to add an administrative assistant. Among the applicants was a legal secretary who seemed extremely well qualified. She was working downtown and was making a lot more than we could pay. However, when we interviewed her we found that she wanted to match her workday to her kids school schedule. She also wanted to be able to take time off occasionally to attend to functions with her children. And, she had no problem with the salary we could pay. To cut a long story short, we worked out a mutually agreeable schedule, hired her and fifteen years later she is Customer Service Manager for the same company. In other words, by being flexible, we created a "win-win" situation for the employee and ourselves. Other examples are retired technical people who want to stay involved in the business, but want the freedom to work a three-day week, or only mornings, or take a two-month vacation in summer. Some companies even let two part-time people share one full-time job. The key to success with this group of people is to focus on the skills required and the tasks that must be done and remain flexible about everything else to accommodate their needs.

$ 3,727

The second group consists of specialists who have figured out they can make a better living by working for a number of employers. When you have a small to medium size organization, quite often you have tasks that require a high level of skill but not on a full-time basis. Many organizations will try to get the job done by an existing employee and as often as not, this results in wasted time, missed schedules and extra costs. Interestingly enough, not only does this result in unhappy customers, it also results in unhappy employees —most employees when put in this position are aware of what is happening and would prefer to avoid the situation. By hiring a specialist for the job, there is a much higher probability that the job will get done on time and on budget. True, the specialist, at $50 to $100 per hour, will cost more per hour than your in-house employee (at maybe $20 per hour). But, when you consider your real costs of doing the job poorly (many hours, rework, unhappy customer, etc.), the cost for the specialist doesn't seem so high anymore. Some people feel they will not pay $75 per hour for anyone, so if they need a person like that, they'll just hire one full-time. If you do hire full-time people for these jobs, you'll have to pay a stiff salary. True, on paper, the hourly rate will be less than $50 to $100 per hour, but the example in Table 2 will illustrate that the total annual cost can easily be more.

This example shows that the cost difference for a single employee can easily be $10,000. In addition, if you hire a high skill employee full-time and you don't have enough jobs that require their skills, you will have an employee that will be looking to find a job where his or her skills are better used! On the other hand, if you use a part-time or contract employee for the high skill jobs; you are their customer. And, most people have a high degree of loyalty to their customers.