What Do We Know about Contracting Out in the United States? Evidence from Household and Establishment Surveys

Upjohn Institute Working Paper 09-157

Matthew Dey
Bureau of Labor Statistics

Susan Houseman
W.E. Upjohn Institute for Employment Research
e-mail: houseman@upjohninstitute.org

Anne Polivka
Bureau of Labor Statistics

2nd Revision | September 2009

JEL Classification Codes: J21, L84, J24

Abstract
A variety of evidence points to significant growth in domestic contracting out over the last two decades, yet the phenomenon is not well documented. In this paper, we pull together data from various sources to shed light on the extent of and trends in domestic outsourcing, the occupations in which it has grown, and the industries engaging in outsourcing for the employment services sector, which has been a particularly important area of domestic outsourcing. In addition, we examine evidence of contracting out of selected occupations to other sectors. We point to many gaps in our knowledge on trends in domestic outsourcing and its implications for employment patterns and to inconsistencies across data sets in the information that is available. We recommend steps to improve data in this area.

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