May Employment: Jobs at Temporary Agencies Surge

unemploymentNearly two years ago, I published an NCPA piece on the growth of temporary employment.  With the advent of ObamaCare and much uncertainty in the economy, I suggested there could be a growing trend in temporary and part-time employment.

Well here you have it: In the area of professional business services employment, 26,000 temporary agency jobs were added. This number far exceeded computer systems design services (6,000) and architectural and engineering services (5,000).  Without doing an extensive analysis, my simple conclusion is that more workers are being hired at temp agencies in order to handle the growing demand for temporary workers.  Not to pat myself on the back, but my crystal ball has been working quite well.  But anybody who has kept up with the state of the economy and the impending health care mandates could see this coming.

Other notable findings:  the unemployment rate is up one-tenth of a point to 7.6 percent from April, but the labor force participation rate is also up one-tenth of a point to 63.4.  However, the LFPR is just a glimmer of hope in an otherwise lukewarm labor report.

Comments (13)

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  1. John Craeten says:

    What is the criterion that determines temporary vs. permanent employment?

    • Kyle says:

      Temps are considered contingent workers who do not have an implicit or explicit contract for on-going employment. They’re usually self reported and lumped in with contractors etc.

    • Pam says:

      A temp employee is a person who is expected to leave after a certain period of time…an agreed up on date.

  2. Nigel says:

    What is creating the demand for temporary labor? Is it just a higher turnover rate for part-time job, or is there just more demand for lower-skill labor?

    • Kyle says:

      Seasonal and underemployment inflate numbers. I believe Pam was referencing the fact that neither temp agencies or the firms that employ temps are responsible for costs inflicted by Obamacare.

    • Pam says:

      I believe that the labor costs associated with hiring a full-time employee, and uncertainty about the economy are creating the demand for temporary labor.

  3. Craig says:

    In order to judge the state of job growth and the economy, shouldn’t we be looking at employment rates instead of unemployment? Because the current shift away from the correlation between unemployment and employment after the financial crisis of 2008.

    • Pam says:

      Besides looking at the unemployment rate I also look at the labor force participation rate. That tells a bigger story. It is at the lowest level in about 30 years now.

  4. Tim says:

    Too bad we aren’t talking about a growing trend in full-time, permanent jobs. Not the best of times for young professionals.

    • JD says:

      There will be long-term career ramifications resulting in a detriment to prosperity.

      • Roget says:

        We also have a generation of people who are unwilling to take jobs which are “beneath them.” That’s the difference between us and the greatest generation. A full days pay for a full days work was an honorable thing — recent graduates have a crippling sense of entitlement.

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