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Paul Osterman is Professor Emeritus of Human Resources and Management at the MIT Sloan School of Management and one of the most important scholars examining how the structure of work is profoundly changing in organizations today.
His research focuses on a growing and often overlooked shift in employment: the rise of “disposable workers.” Osterman estimates that roughly 35% of today’s workforce now falls into this category in some form.
While public attention often centers on gig work — Uber drivers, DoorDash couriers, and freelance labor — his work shows that this is only a small part of the story. In fact, gig workers make up just around 2% of the workforce, and many use that work as supplemental income rather than their primary employment.
The deeper transformation, Osterman argues, is happening inside traditional organizations. Increasingly, companies are redesigning jobs and employment relationships in order to greatly reduce the compensation and benefits they offer. This doesn’t just apply to custodial or cafeteria workers, it includes adjunct professors who earn substantially less money than their peers and have zero chance of every earning tenure. It applies to attorneys in elite firms who are precluded from ever becoming a partner — and contract or contingent workers embedded within major companies such as Google, Meta, Amazon, Microsoft, and Apple. These workers often perform similar functions to full-time employees but remain structurally separated from the organizations they serve.
Osterman’s work highlights a fundamental shift in how companies think about labor. Rather than hiring employee as long-term investments, organizations are increasingly guided by a hierarchy of choices: automate work where possible, outsource when automation is not feasible, rely on contractors when outsourcing is more efficient, and hire full-time employees only as a last resort.
On the surface, this approach is often justified in terms of efficiency, flexibility, and competitiveness. It allows firms to scale labor up and down in response to market demands and reduce the fixed costs associated with permanent employment. But Osterman’s research raises deeper questions about the broader consequences of this model — not only for workers, but for organizations themselves.
What happens to trust, commitment, and organizational culture when a growing share of the workforce is structurally temporary or peripheral? What are the psychological and social effects on individuals who are fully inside organizations in terms of output, but not fully included in terms of opportunity, training, stability, or belonging?
These are not abstract concerns. They go to the heart of how modern work is experienced — and whether the current trajectory of employment is sustainable in the long run.
In this conversation, Osterman explores the economic logic driving these changes, the historical evolution of employer-employee relationships, and the implications of accelerating automation and AI. He also examines whether these trends are an inevitable outcome of capitalism, or whether alternative models of work are still possible — ones that balance flexibility with dignity, and efficiency with long-term human investment.
