Organisations use non-standard employment as a means of flexibility and reduction of fixed costs. An increasingly growing group of employees are self-employed, have work contracts such as part-time and temporary contracts or are employed by a temporary agency, a development catalysed by the COVID pandemic. Whereas there is some evidence that temporary work might affect health via job insecurity (JI) there are hardly any studies focussing on the effects and mechanisms of temporary agency work (TAW). This study sheds light on TAW’s potential health impact and the role of JI in this respect using a mediation analysis. Based on the BIBB/BAuA-Employment Survey 2018 (N = 20.021, representative of the German working population), we analysed the direct effect of TAW on cognitive and psychosomatic aspects of well-being. In particular, we considered JI as mediator for this association. In line with the potentially detrimental effects of temporary employment on well-being, we found that TAW was related to unfavourable outcomes in terms of job satisfaction, general health status and musculoskeletal complaints. JI partially mediated all three underlying associations. Organisations need to be flexible and adaptable. However, by using temporary agency employment as a means to achieve this flexibility, managers and leaders should be aware that it is related to unfavourable well-being and hence hidden costs. In using this type of employment, both the temporary work agency and the user company should consider these health risks by providing health care, options for increasing the temporary agency workers (TA), workers employability, and equal treatment between permanent and TA workers at the actual workplace.
Temporary Agency Work and Well-Being—The Mediating Role of Job Insecurity