In September 2014, according to the U.S. Bureau of Labor Statistics (BLS) the U.S. economy added 19,700 temporary help services jobs, and the number of temporary help services jobs in August 2014 was revised upward by 17,600.
The unemployment rate dropped to 5.9 percent, while payrolls exceeded expectations with 248,000 jobs added. Professional and business services added 81,000 jobs. Outside of employment services, 12,000 of that total came from technical consulting services and 6,000 from architectural and engineering services.
The retail industry grew by 35,000, and healthcare added 23,000 jobs. Information, an industry with little employment gains over 2014, also showed growth with 12,000 jobs added, of which 5,000 were in telecommunications. Leisure and hospitality added 20,000, construction added 16,000, and financial activities gained 12,000 jobs.
According to the Commerce Department, the U.S. economy grew at its fastest pace in 2-1/2 years in the second quarter of 2014. The Commerce Department raised its estimate of gross domestic product to show that the economy expanded at a 4.6 percent annual rate.
A recently released national employment report by the Society for Human Resource Management (SHRM) states that 52.2 percent of manufacturing companies planned to hire in October, and 47.5 percent of service-sector employers planned to add staff.
“With many organizations hiring, competition for the best candidates may be heating up. The difficulty filling key jobs may be why rates for some new-hire positions improved in September for both the manufacturing and service sectors.” ~Jennifer Schramm, Manager of Workforce Trends at SHRM
CareerBuilder’s fourth-quarter 2014 U.S. job forecast survey found that 29 percent of employers plan to add full-time, permanent headcount in the fourth quarter. In addition, the survey found that 26 percent of employers had plans to hire seasonal workers in the fourth quarter. Popular seasonal positions included customer service, administrative/clerical, shipping/delivery, accounting/finance, and inventory management.
Research conducted by Richard Curtin, professor and director of surveys at the University of Michigan, projects that the accounting/finance and information technology sectors will increase staffing in Q4. One-third of companies surveyed had plans to increase the overall size of their accounting, finance, and IT departments. A large number of them planned to hire more temporary, temp-to-hire, and contract workers in 2015.
Bonuses Are High
A recent survey by Aon Hewitt found that organizations are spending record amounts of their payroll on bonuses. Companies are committing an average of 12.7 percent of their 2014 payrolls to variable pay, including individual or company-wide performance-based bonuses. The survey of over 1,064 companies found that more than 90 percent offered a variable-pay program. Meanwhile, companies expect base salary increases to grow slightly to 3 percent in 2015.
A SHRM study reported that 74 percent of respondents used market-based pay increases. The use of sign-on/hiring bonuses, spot bonuses, retention bonuses, and project completion bonuses increased in the past couple of years, suggesting that companies are focusing on employee retention as the economy continues to improve.
U.S. Temp Work at Record High
A recent survey by the Freelancers Union found that independent contractors, temporary workers, and those working a second job constitute 34 percent of the U.S. workforce. According to a report by the National Employment Law Project (NELP) and the National Staffing Workers Alliance (NSWA), about 2.5 percent of all American jobs are in the employment services industry, which includes staffing agencies, professional employer organizations and employment placement agencies.
The number of staffing jobs has reached a record high of 2.8 million people.
A new study by MBO Partners reveals that the number of independent workers in the U.S. will grow to just under 40 million in 2019. The study divided independent workers into two groups: “solopreneurs” who work 15 hours or more per week and “side-giggers” who work as independent workers for less than 15 hours a week. According to the survey, there were 17.9 million solopreneurs who generated about $1.1 trillion in total income last year. There are 12.1 million side-giggers.
“Our study reveals independent work is far from a one-size fits all story. With shades of independence – from solopreneurs to side-giggers – there is a clear need for a variety of workforce solutions. The study is a wake-up call that at 30 million strong and forecast to grow to 40 million, the independent workforce is not just here, but here to stay.” ~Gene Zaino, CEO and President at MBO Partners.
California Law to Protect Temp Workers
Just recently the state of California signed a bill into law that will hold companies responsible when their subcontracted temp agencies endanger or underpay workers. The law is known as Assembly Bill 1897 and is designed to address accountability issues in the temp industry.
AB 1897 will require “the client employer to share with a labor contractor all civil legal responsibility and civil liability” for paying wages to workers.
The bill, which was lobbied for by several labor groups, was met with applause by some parties. A strong advocate, The Teamsters, was pleased with the passing of the bill. Teamsters President Jim Hoffa said, “Today marks a new era for worker protection in California. No longer can employers hide behind unscrupulous labor contractors. Workers, no matter if they are temporary or permanent, can hold companies who profit from their labor accountable for violations in the workplace.”
The bill also had many opponents, including the California Chamber of Commerce who said that the bill would “discourage future growth in this state, and it will certainly discourage out-of-state companies from locating here.”