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Rise and Fall (and Rise Again) of Temporary Staffing

More than 2.5 million people are employed through temporary staffing in the U.S.  TLNT’s John Zappe puts that figure into perspective with his report that “there are now more workers employed as temps than at any time since before the start of the 21st century.” Temp staffing is growing five times faster than the overall economy. In the major metro areas of Dallas-Ft. Worth, Houston-Baytown and Austin, TX, temporary job growth from 2009 to 2013 has increased nearly 50 percent.

In Austin, where startups continue to flourish, this means an already competitive job market for temporary staffing is gaining even more speed. At this very moment, Austin ranks first as Bloomberg’s Top American Boomtown, 10th in Forbes’ Best Big City for Jobs, and third in tech job growth by Dice.com, among dozens of other high-profile lists. The fast-growing companies who put Austin on the map have learned to lean on temporary staffing agencies to manage growth.

“Startups such as ours often experience aggressive growth which can be challenging to navigate,” says BuildASign.com Senior Operations Manager Michael Pelletier. Founded in 2005, Austin-based BuildASign.com boasts an average of 50 percent year-over-year financial growth and now employs more 215 people.

“Having a quality partner able to provide talented individuals on short notice is of tremendous value,” Pelletier adds. “Fluctuations in demands on the business can be more easily managed by relying on the staffing partner to provide the talent, while our core team focuses on the business strategy.”

As we’ve covered previously in a recent article on temporary/contract and direct hire, employers like BuildASign.com often hires temps with the intention of making many of the positions permanent. Another common practice is to hire temps to cover seasonal fluctuations in business demand. However, a new trend has developed that bucks the temp-to-hire and seasonal staffing norms. Alden Wicker recently pointed out on Learnvest.com, “Traditionally, the hiring of more temp workers indicates a future bump in the hiring of full-time workers, as those temp workers are converted to full-time staff. But this time is different. Companies have been burned several times by the stuttering economy, so they’re loath to commit to a full-time worker.”

Enter the era of the “New Permanent Temp,” as Harvard Business Review dubs it. It’s an idea that is likely contributing to the huge rise in temporary employment above any other job sector. Some experts point to looming healthcare reform mandates for employers with more than 50 full-time employees as a key reason to keep new positions temporary. But is this a Machiavellian tactic that only benefits employers?

Not necessarily. Many temporary employees are empowered by this trend. Forbes contributor and career transition coach Kerry Hannon touts temporary employment as a great way for valuable retirees to stay in the game. And Erin Hatton, an assistant professor of sociology at the State University of New York, Buffalo and author of “The Temp Economy: From Kelly Girls to Permatemps in Postwar America” cautions viewing temporary workers as expendable staff

Pelletier sees staffing agencies as important partners in determining the best route—for everyone involved.

“Our partners are now involved during the early phases of project planning. They understand our business needs and processes, which significantly increases our ability to deliver value to our customers in the most efficient and effective way,” he says.

What positions have you seen (or are you considering) hiring as temp positions that have been permanent in the past? Do you see this trend continuing? We’d love to hear from you!

 

Image credit: feedough / 123RF Stock Photo