April was another hot month for the temp penetration rate. According to a report by Staffing Industry Analysts (SIA), temp jobs rose by 5800 in April, reaching a new all-time high penetration rate of 2.058%. While the temp penetration rate rose, unemployment fell. Not only did overall unemployment fall from 4.5% to 4.4%, the college-level unemployment, which is an indicator for professional employment, dropped from 2.5% to 2.4%.
There are several driving factors behind the increase in temp employment, but two of the top ones include:
- As Baby Boomer retire, Millennials and GenZ have discovered that temp and contract positions – often in high-level positions help fulfill their bent toward flexibility, work-life balance, alternative scheduling, and the opportunity to travel while working via telecommunication. In this burgeoning gig-economy, temp work allows them to follow new priorities. Yes, money is important, but it is not the only factor.
- From the other side of the coin, companies find that temp or contract talent brings multiple benefits including the ability to remain flexible and agile in their staffing needs – especially when hiring for a specific project. It also provides an opportunity to both save on the cost of benefits, healthcare, etc. as well as to “test” a candidate before committing to a long-term relationship. In fact, data reveals that contingent staff makes up as much as 30% of the total workforce in some companies.
The SIA reports that temp staffing revenue rose a median 6% year over year from Spring 2016 to Spring 2017. Predictions indicate a continued growth in temp penetration in 2017. Furthermore, professional jobs continue to comprise an increasing share of the US temporary staffing market.
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