There has been no economic recovery for jobless Americans. And in many cases, even when there are hirings, the positions are only temporary.
Jobs aren't easy to come by these days, especially permanent ones. Companies seem more eager to supplement their staff with temporary workers — their numbers are on the rise.
Americans looking for work haven't heard much good news lately. The latest monthly jobs report was weak — and outsourcing is on the rise. Most industries just aren't adding workers at a rapid clip. But the temp business is bucking the trend.
“Over the short term we are definitely seeing an uptick in demand right now,” said William Yoh, CEO of Yoh Group, a technology staffing company. “We’re seeing that both in emerging tech and in some of the niche markets.” (Yoh Group provides temporary workers to CNBC.)
“Temporary help employment was about 1 percent of all American employment at the beginning of the 1990s, and by the year 2000 it was over 2 percent of American employment,” said Gary Burtless at the Brookings Institution. “The number of people in temp help agencies went up about two-and-a-half times in that single decade.”
The temporary help business is one of the fastest growing industries in the economy. Since September, when companies started to add more jobs than were being cut, temp workers increased by 87,000 to 2.4 million workers, nearly a quarter of jobs added nationally, despite the fact that outsourcing has also limited the type of temp jobs available.
“The manufacturing sector and to some extent the tech sector are seeing the effect of outsourcing, to jobs moving overseas,” said Patrick Dolan, a marketing manager with Adecco, a Swiss-based global staffing firm. “I believe that in some sense that is being made up in terms of in the areas of customer service or in certain client facing positions that might counterbalance that a bit.”
Temp companies say a big reason employers turn to their workers is to keep costs down.
“Certainly in terms of jobs and employment the wage itself is a small component,” said Dolan. “It’s really kind of the invisible costs sometimes that are the hardest to manage and those are health care, those are statutory requirements and taxes, those are also the area where our larger clients are asking us to get involved in a more strategic sense in managing those more invisible costs.”
And things are expected to keep looking up for staffing firms. The Bureau of Labor Statistics predicts the temp industry will keep growing strong at least through 2006.
For lower paid employees, health care is a big part of cost to an employer. That, and reluctance to make a long term commitment, pushes many employers toward temp workers.
