November 8, 2012

Temp-job market strong

It’s been a decent year for temporary workers and temporary agencies, say local companies..

It’s been a decent year for temporary workers and temporary agencies, say local companies..

Demand for temp workers has picked up faster than the slow overall jobs growth in the Wichita area.

“Actually, it’s been a lot better than ’11,” said Shannon Wright, area manager for Staffmark, which supplies workers for Coleman Co. and Johnson Controls, among others.

The staffing industry has traditionally supplied workers early in recoveries, when companies are uncertain about the future and hesitant to hire permanent staff. So they use temporary workers – and shed them quickly when business drops.

The result is a temp employment market with exaggerated ups and downs compared to the regular workforce.

And that seems to be the case again this time, say those who watch the local labor market. The regular Wichita area workforce has added about 1,000 jobs a year – about 1/3 of 1 percent – since hitting bottom in 2010. Local temp services report higher growth.

“We are seeing a lot of business,” said Vince Macias, branch manager for Adecco in Wichita. “It seems like such a trend in the work industry and has a lot to with the economy.”

Kent Venters, branch manager in Wichita for Manpower, estimated the company’s billable hours are up about 2 percent over last year.

“Right now, it is challenging,” Venters said, but he sees more hiring after the beginning of the year.

It’s just a matter of being smart in uncertain times, said Wright of Staffmark. Not only can clients trim their workforce with a quick phone call, but the staffing agency worries about fluctuating taxes, health care contributions and workers’ comp contributions.

“Our economy is still unstable,” she said. “Companies who want to hire 10 people don’t want to have to lay them off again in a few months if things change.”

Seasonal hires

The holiday season is traditionally a huge season for temp hiring. But this year, forecasts look similar to overall temp hiring trends: slow growth.

Challenger, Gray and Christmas, a national outplacement firm, is predicting a slight increase in the total numbers, in the neighborhood of 6 percent, said James Pedderson, the firm’s director of public relations.

“Consumers are spending more, but it’s not as if sales are exploding,” he said.

If the estimate is right, it would put the total of seasonal workers at the highest level since before the recession, but still below earlier decades, when there were no online sales.

Some of the announcements for hiring by larger chain retailers do appear more optimistic than that forecast, Pedderson said, but those are anecdotal. If sales are stronger than the forecast, retailers have lengthy lists of job applicants to bring on in the next six weeks.

Structural shift

Steve Berchem, chief operating officer of the American Staffing Association, thinks this recession and recovery is the first evidence of a structural shift in the economy to one with more temporary and contract workers.

The evidence, he said, is a stronger uptick in the hiring of temp workers after the 2007-09 recession than the previous two recessions. That suggests that companies are finding permanent solutions to their labor needs, he said.

“Our members are hearing anecdotally from their clients that it was such a gut-wrenching experience to let a third or a half of their staff go that nobody wants to go through that again,” he said. “And that is why businesses are saying ‘We don’t want to hire any more. We’ll get our talent when we need it.’ That’s also why we’re seeing them staff up for special projects. The economy is changing so fast globally that they need to be nimble and not be burdened with people they may not need later.”

One trend in staffing, he said, is the expansion in the number of high-skill workers, accountants, engineers, programmers and scientists.

But, he cautioned, staffing firms only employ about 2 percent of the national workforce, so it’s not as if everyone will become a “contingent worker” in the future, he said.

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