Staffing agencies report record number of contract, temp workers

Dive Brief:

U.S. staffing companies employed an average of 3.10 million temporary and contract workers per week in the first quarter of 2018, according to the American Staffing Association (ASA). That number is the highest since ASA starting tracking it in 1992.
An increase of 1.2% in Q1 2018 over the same time last year revealed the largest year-to-year growth since 2015. Temporary staffing typically peaks in the last quarter of the year; this year the seasonal jump dropped 7.0% in the first quarter.
Contract and temporary staffing sales totaled over $32 billion for Q1 2018, showing gains of 2.5% over the same period last year.

Dive Insight:

The growth appears to be continuing, as ASA reported swift year-over-year growth in May 2018, as well. Temporary and contract workers are filling vacancies created by low unemployment rates and the skills gap, and growth may be further encouraged by employees seeking more flexible work arrangements. Some data suggests temporary and contract workers could total 50% of the American workforce in the near future — though a recent Bureau of Labor Statistics report shows much more subdued growth.

Now that summer has arrived, wages and shifts are on the rise as employers compete for talent in a shrinking market. Many companies have incorporated part-time, temporary and contract workers into their business plan, relying on those workers for the foreseeable future. The trend may be gaining momentum, as one major player in Silicon Valley, SurveyMonkey is now offering its contract workers benefits that are nearly the exact same as those offered to full-time employees, in an effort to improve recruiting and retention. As businesses adapt to the workforce of the future, they may see contract work start to take a different shape: many contractors are highly educated and experienced, and one study points to 73% of such workers holding advanced degrees.

But as the use of contractors continues to grow, the government is watching closely. In California, a new test for contractors assumes workers are indeed employees unless they pass an “ABC” test created by the state’s Supreme Court.