America’s job market doesn’t have a lot of bright spots these days. One is the temporary staffing industry, which is growing at a robust pace.
“At the national level, it is the fastest-growing industry,” said Robert Crouch, vice president of Sedona Staffing, which staffs companies in Waco, Temple and Killeen. “That’s a fact.”
Numbers supplied by the American Staffing Association back up Crouch’s claim. According to the group’s website, www.americanstaffing.net, the staffing and recruiting industry has created more jobs than any other industry in the last three years.
U.S. Bureau of Labor Statistics show staffing firms added 786,000 jobs between June 2009 and July 2012, while accounting for less than 2 percent of American jobs. Health care, which accounts for 11 percent, added 829,000 jobs during that same period. The bureau reported that the temporary staffing industry grew 45 percent since the recession ended in 2009.
Jason Linder, branch manager of Labor Ready in Killeen, said the area might be outpacing even those numbers. He said his company, which works closely with the construction industry, has grown by “leaps and bounds” over the last three years.
“From the downturn in ’08 and ’09, it got pretty slow,” Linder said. “A lot of people were cautions about hiring, especially our customers. It was an initial shock for us, because activity dropped in 2009.”
Abrupt change in late 2009
Linder said things changed abruptly in late 2009.
“Since the slowest part of 2009, we have increased by about 60 percent,” Linder said. “I think that’s accurate.”
Sol Melton, area manager for Spherion Staffing Services in Temple, said the numbers at his company are similar. He said he thinks this bodes well for the overall job market.
“That’s pretty dead on,” Melton said. “As you will hear from any economist, the staffing industry is a very good indicator of what is going on in the economy. As staffing payroll decreases, it is a sign of a recession. As you see an increase, that is an indicator things are picking up.”
Solid growth last year for national, local temp companies
Melton said the national numbers are very solid, but locally they are among the best he has seen.
“2012 was very strong,” he said. “(Nationally) it wasn’t the best ever, but it was a very good year. From a local standpoint, it was one of the best.”
Killeen residents and people connected to the military have benefited from the growth.
“I would say 85 percent of our employees live in Killeen,” Melton said. “I would say an equivalent amount of our employes are someone related to the military.”
Workforce Solutions of Texas has noticed the uptick in temp employment, said Wendy Ann Damon, career center supervisor at Workforce Solutions of Central Texas.
“There has been an increase in individuals getting hired in temp assignments,” Damon said. “Some of that is from companies hiring temps on their own, and some of that is through the use of agencies.”
Damon said temp work is ideal for people who need immediate employment or want to get their foot in the door with an area employer.
“Using temp agencies is a great way to get introduced to the various employers in the area and get your foot in the door with a company,” Damon said. “Many of the temp agencies have both an employment side for temp assignments, as well as a side that seeks full-time professionals for companies.”
Damon said another advantage is that most temp agencies are national operations.
“The great part about that is if you relocate, it is real easy to get with the temp agency at the new location because you are already working with them,” she said.
Growth comes with caveat
The growth in the temporary employment industry does have a caveat. Much of the growth is recovery from losses the industry suffered during the recession. While the industry is growing at a rapid rate, it is not employing a record number of people.
According to the staffing association’s quarterly employment and sales survey, staffing firms lost almost 1.2 million jobs, or 36 percent of their workforce, during the 18-month recession.
“It’s a relative thing,” Crouch said. “Our industry is the fastest-growing industry out of all the industries. It sounds great, but the problem is the staffing industry has had better years in terms of how many employees it has. But it is growing faster than any other industry now.”
Part of the reason temp agencies are recovering quickly is the convenience and cost savings they offer companies. Temp agencies can save them money by handling payroll, government taxes and the soft cost of losing productivity due to an open position.
“It’s like a turnkey employee,” Linder said.
Despite the savings, statistics show that unless there is a major paradigm shift, the American worker does not have to worry about being replaced by lower cost temps. Currently, there are almost a half-million fewer temps employed nationwide than there were before the recession.
“Do I think companies will eventually stop hiring their own people? No,” Damon said. “The use of temp agencies has been going on for decades, and that isn’t going to change.”