I wrote the Contract Employee's Handbook as a public service because there is no single comprehensive resource for W-2 contract employees, either in print or on the Internet. W-2 contractors are those contractors who are NOT independent, who are employed by contract employment agencies, and are frequently taken advantage of by commissioned headhunters. If the agency will not tell you the bill rate, and 99% will NOT tell you the bill rate, they have a license to steal, often taking 50% or more off the top. When contract employees think and act like independent contractors they can typically double their income compared with contract employees who place their careers and livelihoods in the hands of commissioned headhunters, and yet have none of the hassles of self employment that plague independent contractors.

If you have never before visited The Contract Employee's Handbook, by all means do so now. The Handbook is a rich source of free information on W-2 contract employment. Whether you are already a contractor, or possibly a permanent employee facing the prospect of being downsized, you are sure to benefit from a visit to The Contract Employee's Handbook.

If you find the information in The Contract Employee's Handbook useful, by all means tell your friends and colleagues. I invite you to follow the instructions at the end of this newsletter, and add their e-mail addresses to the mailing list. Several people have reported that they learned of the Handbook from a flyer that someone posted in their workplace. You might consider doing the same. There is a suitable flyer in the "Tell a Friend" section of the Handbook. Or, click these links and print the results: Flyer-1 and Flyer-2.

If you can arrange it, I recommend The Contract Employee's Workshop. The cost is just $125, which as a savvy contract employee you will probably earn back from the increased differential in your paycheck in just the first few hours on your next assignment. Although based in the San Francisco area, I will travel outside Northern California to give Workshops to groups of 40 or more paid participants. To those who organize a "remote" workshop I offer two free admissions as compensation for your effort.

The Contract Employee's Workshop is also available for corporate outplacement training, and I welcome inquiries from corporate HR departments.

You can find information on The Contract Employee's Workshop and on-line registration at http://www.cehandbook.com/cehandbook/htmlpages/ ceh_main_workshop.html.

Both The Contract Employee's Handbook and The Contract Employee's Workshop show contractors how to achieve self-reliance and security as a W-2 contract employee.

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A SOCIETY THAT IS INCREASINGLY "JOBLESS BUT NOT WORKLESS"

We live in an era of irony for American workers. The economy is stronger than ever, business is booming, and corporations are struggling to hire qualified, skilled workers so they can compete in today's marketplace. Nowhere is this more apparent than in California's Santa Clara County (a.k.a. Silicon Valley). Workers in Silicon Valley commute up to 150 miles round trip to earn big bucks in that burgeoning high-tech enclave. Affordable housing in the area is virtually non-existent. Traffic is impossible. And yet, the region continues to grow.

At the same time, the United States is entrenched in a frenzy of corporate downsizing and consolidation, leading to unwelcome wholesale terminations and "forced" early retirements.

In the past, lay-offs occurred because the economy was STAGNANT, and lay-offs signaled hard times ahead for unemployed workers. But today, one can argue, lay-offs are occurring because the economy is so STRONG! The constant churning of the workforce reflects a profound restructuring of work in America. Companies are slashing middle management to facilitate transformation from a traditional, vertically integrated organization to a horizontally networked organization. Corporate deadwood and expensive long-term employees are getting the axe, and whole departments are being eliminated in the pursuit of strategic flexibility.

In their efforts to stay competitive, companies are now looking outward to a multitude of outsourcing solutions powered by a workforce of contingent employees. In Santa Clara Valley up to 40% of the workforce can be considered contingent employees. This trend is especially noticeable in the temporary help industry where, since 1984, employment in temporary help agencies has grown at a rate nearly ten times the overall employment growth in that region, according to California EDD figures. Currently, there are over 250 offices of temporary help agencies in Silicon Valley.

Not only are companies outsourcing their non-core administrative and service functions, they are increasingly outsourcing their strategic core functions as well. In the words of a recent Coopers & Lybrand advertisement: "[Companies] are hiring [Coopers & Lybrand] as much to think for them as to do for them."

Another irony: As corporate organizations are becoming flatter than a prairie dog on an interstate highway, compensation for upper management and corporate CEOs is higher than ever, ... measured either in real dollars, in adjusted dollars, or as multiples of the average worker's income. A recent white paper published by the Yankee Group, a worldwide market research and consulting firm, makes the point that outsourcing releases management to focus on its core business. The paper continues with an explanation of how the survivors of middle management lay-offs personally benefit from outsourcing: "Improved employee motivation through enhanced career-path alternatives, increased advancement opportunities, increased profit-sharing opportunities and better training." In other words, survivors get a bigger slice of the corporate pie and a ride on the express elevator to the top.

Rhetorical question: Is permanent employment becoming the modern equivalent to membership in an exclusive club?

Benner's report documents that while the numbers of temporary workers are increasing dramatically, their real incomes are actually decreasing. When adjusted for inflation, average wages for all temporary help workers declined by nearly 15% between 1989 and 1995. Among the hardest hit were technical temps who saw their wages decline in real terms by 28% during the same period.

It is imperative that displaced workers keep their transferable, marketable production skills up to date. This is especially true for mid- to high-level managers who are in the habit of delegating important, but routine, tasks to lower level skilled workers. Managers who have failed to keep their hands-on skills current are in for a rude awakening, to be sure.

Nevertheless, according to a recent nationwide survey by Interim Services Inc. and Louis Harris and Associates, workers are the happiest when they continually improve their skills, demand greater job satisfaction and rewards, and consider themselves free agents rather than one company's lifelong employees. These employees believe that focusing on advancement is more important than staying with one employer. The Interim survey reports that 62% of those who lost or left a job because of downsizing feel they are better off professionally than they used to be. Workers hit the hardest by downsizing were those who didn't acquire new marketable skills.

If there is a lesson here it can be summed up in the words of James Meadows, Vice President for Human Resources at AT&T, quoted in the New York Times, 2/13/1996: "People need to look at themselves as self-employed, as vendors who come to this company to sell their skills. In AT&T, we have to promote the concept of the whole work force being contingent though most of our contingent workers are inside our walls. 'Jobs' are being replaced by 'projects' and 'fields of work', giving rise to a society that is increasingly 'jobless but not workless'." -- JRZ

The Contract Employee's Workshop is a hands-on, in-your-face, no-holds-barred expansion of the principles and methods revealed in The Contract Employee's Handbook. Learn first hand the secrets your friendly commissioned headhunter will NEVER tell you . . . and why! Learn why you don't have to be an independent contractor to earn twice as much as most other W-2 contract employees . . . and how!

Workshops are scheduled for the following locations and dates:

• San Ramon, CA -- January 3, 1998
• San Jose, CA -- January 17, 1998
• Santa Clara, CA -- January 31, 1998
• Walnut Creek, CA -- February 14, 1998
• San Francisco Airport, CA -- February 28, 1998
• Mountain View, CA -- March 14, 1998

Or, schedule a workshop anywhere in the USA.

Find out more and register for The Contract Employee's Workshop at http://www.cehandbook.com/cehandbook/htmlpages/ ceh_main_workshop.html

The Contract Employee's Handbook and The Contract Employee's Workshop put YOU in charge of your own career as a contract employee. Dungaree Dan says: "Check'em out!"

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LEGAL STUFF:

The Contract Employee's Handbook, The Contract Employee's Workshop, and The Contract Employee's Newsletter are trademarks of James R. Ziegler.

This newsletter is designed to provide information on contract employment, and is sent with the understanding that the editor and publisher are not engaged in rendering legal or financial advice. If expert assistance is required, the services of a licensed professional should be sought.
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Wishing You Happiness, Success and Prosperity,

James R. Ziegler, Ph.D.
Author and Webmaster
The Contract Employee's Handbook
jziegler@cehandbook.com