Jan 01, 2014

DCR National Temp Wage Index – January 2014

DCR National Temp Wage Index

The surge in wage forecasts for temporary workers at the end of 2013 is well justified by the increased demand for workers, especially in the retail and manufacturing sectors. The manufacturing industry has slowly begun to regain momentum with a workforce population of over 12 million during the fourth quarter of the year. The last few months of 2013 saw an increase of more than 25,000 temporary workers compared to the third quarter of the year.

Japan, Brazil, the United Kingdom, and the United States are expected to be the leading economies in 2014 for staffing industry growth. The U.S.A. is expected to grow by 5%, second only to the United Kingdom. The United States alone accounts for 30% of the total staffing industry annual sales of $422 billion.

In November 2013, employers added 203,000 jobs to the economy, according to the U.S. Bureau of Labor Statistics, which exceeds economists’ predictions by 23,000 jobs. The unemployment rate declined to 7 percent from 7.3 percent in October, and the labor force participation rate increased slightly to 63 percent from 62.8 percent in the previous month. Major job gains came from the health care, transportation/warehousing, and manufacturing industries. Temporary help employment added 16,400 new jobs in November, up 0.6 percent from October 2013 for a total of 2.78 million jobs. On a year-over-year basis, temp jobs were up by 8.6 percent in November.

The U.S. temporary employment penetration rate, a measure of temp jobs as a percentage of total employment, reached it’s all-time high (set in April 2000) in November 2013 at 2.03 percent.

Year-over-Year Growth in Temp Jobs, Seasonally Adjusted

Year-over-Year Growth in Temp Jobs

Small and Medium Sized Companies Engage More Temps

A survey conducted by Lucas Group and published by Staffing Industry Analysts (SIA) in October 2013 showed that 42 percent of small- and medium-sized companies felt more positive about the hiring of contract workers compared to a year ago. The survey found that 49 percent of these companies plan to hire a combination of contract and permanent employees.

The Usage of VMS and MSP Solutions

Staffing Industry Analysts (SIA) estimates that contingent staffing is going to increase as companies look for more flexibility to meet market demands. A survey by SIA saw that over half the respondents were currently using a VMS or MSP solution, and cited the main advantages to be a faster hiring process, lowered cost, decreased workload, and enhanced tracking and reporting capabilities. The biggest challenge was uncovered to be the sourcing of unqualified candidates or pools of candidates who were not a good fit for the organization. High turnover, lack of engagement, lack of communication and contact, loss of control, and complexity were also on the list of complaints.

According to research by SIA, VMS and MSP spend under management was $100 billion in 2012, up from $84 billion in 2010.

“We believe the current record high usage of temporary staffing is indicative of a gradual upward secular shift in the acceptance and adoption of temporary staffing, and the role that it plays in giving businesses added flexibility in managing their workforce.” ~Timothy Landhuis, senior research analyst at Staffing Industry Analysts.