Increase in Temporary Work May Indicate Signs of Recovery

According to the Bureau of Labor Statistics (BLS), temporary and contract work has increased significantly. That is offsetting to some extent continued job losses in a number of sectors.

Employment in professional and business services rose by 86,000 in November. Temporary help services accounted for the majority of the increase, adding 52,000 jobs. Since July, temporary help services employment has risen by 117,000.

Writes Paul Davidson of the USAToday:

A big reason employers shed a far-less-than-expected 11,000 jobs last month is that temporary staffing agencies found slots for 52,000 additional workers, the most since 2004, the Bureau of Labor Statistics (BLS) said.
That’s a good sign because cautious employers typically hire temps in a recovery before bringing on full-time staffers.

Trends in temporary and contract hiring offer a unique gauge of economic recovery, particularly when emerging from recessions. Richard Wahlquist, president of the American Staffing Association, gave his own interpretation of the data for the San Francisco Chronicle:

Based on his analysis of 36 years of data, temp employment has come back about three to six months before overall hiring, which would mean overall job gains by February.
Even if that timeline holds, Wahlquist thinks temporary labor will become a larger factor after this recession as companies build a ring of disposable workers around their core staff.
“After the last two recessions, a lot of businesses don’t want to get caught again,” he said.
Wahlquist said the job market will be “brutally competitive” next year and urged people to take temporary work to earn income and get on the inside track when permanent hiring resumes.
 

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