Temp Hiring Provides Bright Spot in Otherwise Dreary Report

From the Wall Street Journal | Jan 8, 2010 | By Diana Middleton

The hiring of temporary
workers is a leading indicator of future job growth, and new employment
numbers suggest the U.S. economy may be on the road to recovery.

Last month, temporary employment rose 2.5%, seasonally adjusted, according to the Labor Department's
employment report. "As employers feel more secure, they bring back
furloughed workers, lengthen the hours for existing workers and then
bring on temporary staffers," says Richard Wahlquist, president and chief executive officer of the Alexandria, Va.-based American Staffing Association.
"These are the classic early stage of recovery." Interim job creation
typically precedes standard job growth by three to six months, says Mr.
Wahlquist.

It's also common for employers to convert temporary hires into staff employees, says Brett Good, district president of Robert Half International, a staffing company based in Menlo Park, Calif.

"Six to nine months ago, the jobs available were truly temporary,"
Mr. Good says. "Now people are being brought in on a project basis, and
employers are indicating that these positions will be rolled over into
permanent payroll once the economy stabilizes."

After cutting so deeply into infrastructure during the recession,
companies are at a breaking point, adds Mr. Good. They simply can't
increase productivity without adding to the head count, he says.

Growing sectors include financial services, manufacturing and information technology, says William Grubbs, executive vice president and chief operating officer of Spherion,
a staffing firm based in Fort Lauderdale, Fl. "Moving forward, we're
also going to see even more growth in the more high-end professional
sectors," he adds.

Meanwhile, with 15 million people out of work, competition for even
temporary positions will be stiff, warns Mr. Wahlquist. "Companies will
see talent pools as deep and rich as they've ever been," he says. "But
the job market will continue to seem brutal."