The Changing Nature of Employment Arrangements and the Implications for Job Quality

The goal of this paper is to develop a comprehensive research agenda to analyze trends in domestic
outsourcing in the United States—firms’ use of contractors and independent contractors—and its effects
on job quality and inequality. In the process, we review definitions of outsourcing, the available scant
empirical research, and limitations of existing data sources. We also summarize theories that attempt to
explain why firms contract out for certain functions and assess their predictions about likely impacts on
job quality. We then lay out in detail a major research initiative on domestic outsourcing, discussing the
questions it should answer and providing a menu of research methodologies and potential data sources.
Such a research investment will be a critical resource for policymakers and other stakeholders as they
seek solutions to problems arising from the changing nature of work.