35% of U.S. Workers Now 'Disposable,' MIT Research Finds

More than one-third of American workers are already being treated as "disposable" by their employers, according to new research from MIT, and artificial intelligence threatens to push that number even higher.

Paul Osterman, emeritus professor of work and organization studies at MIT's Sloan School of Management, conducted a national survey of over 6,000 workers and found that 35% fall into what he terms the "disposable" category. His findings appear in his newly released book, Disposable Workers: The Transformation of Employment.

Three categories of disposable workers

Osterman identifies three distinct groups within this disposable workforce. The first consists of contractors—workers employed by contracting companies or staffing firms rather than the organizations they serve. This category spans from janitors to travel nurses.

The second group includes freelancers, ranging from gig economy workers like Uber drivers to independent professionals such as computer programmers working on a project basis.

The third category comprises what Osterman calls "marginal employees"—workers who are technically on an organization's payroll but have no realistic path to advancement. Examples include adjunct faculty at universities and staff attorneys in law firms who perform essential work but will never be considered for partnership or tenure. These positions typically experience high turnover and offer no long-term career prospects within the organization.

"These people get the work done for organizations, but the organizations make no commitment to them," Osterman explains. "They're disposable."

Why it matters

This research reframes the AI employment debate beyond simple job loss projections. While headlines focus on automation eliminating positions entirely, Osterman's work reveals a parallel transformation already underway: employers systematically reducing their obligations to workers while maintaining productivity. As AI tools enable companies to disaggregate work into smaller, more easily outsourced tasks, this trend could accelerate dramatically. For business leaders, the findings suggest workforce strategies increasingly favor flexibility over stability—a shift with significant implications for talent retention, organizational knowledge, and long-term competitiveness.

The economic rationale

Osterman attributes the rise of disposable workers to both shifting employer attitudes and economic calculations. He cites a 2023 McKinsey & Company report, The State of Organizations, which claimed that 95% of an organization's value comes from just 5% of its employees. This perspective provides justification for companies to minimize investment in the majority of their workforce.

The AI dimension adds urgency to these findings. Rather than focusing solely on how many jobs artificial intelligence might eliminate, Osterman argues the technology could deepen workforce insecurity by making it easier for companies to fragment work and rely even more heavily on contingent labor arrangements.

These details were first reported by Forbes in an article by Courtney Connley-Hampton.