American Staffing Association reports increase in temporary employment placement

Cari Shaffer sees the temporary staffing business as a barometer for other industries. And based on increasing placements, she's optimistic about the direction that the economy is headed.

I think we can expect economic continued growth in the Pikes Peak region, said Shaffer, owner of Add-Staff,

Those projections are in line with a report issued by the American Staffing Association this week that showed an 11.1 percent increase in temporary and contract worker placement per day during the first quarter of 2005 compared to last year. That total was more than half a point higher than the annual rate of 10.4 percent forecast by Staffing Industry Analysts Inc.

Building on last year's momentum, staffing employment set a new first quarter record, eclipsing the first quarter 2000 record by 6 percent, said Richard Wahlquist, ASA president and CEO. More than 1.7 million jobs will be created by the employment services sector through 2012, he said, which is more than double the number expected from the computer systems and software development sectors combined.

The ASA report says the rebound in employment is linked to three factors: an improved economy which motivated the Federal Reserve to raise interest rates, a falling unemployment rate and tightening labor market and the fact that three-quarters of all employees are looking for new jobs.

The latter statistic is taken from a 2004 survey conducted by the Society for Human Resource Management and Career-Journal.com. Both sources agree that the boost in employee turnover means increased job vacancies.

Shaffer said her business began bouncing back as early as a week before Thanksgiving 2003. For three years, she watched as several high tech recruiting and specialty staffing agencies closed their doors and left town.

We survived and allowed attrition to hone our staff, she said. I was shocked by the 2003 holiday season. That's typically a slow period for us. Instead, we enjoyed the biggest December we've had in years.

Eighteen months later, the company has hired an additional placement representative and is back up to 18 employees.

Admittedly, the job market of 2005 still lags behind the fast job growth of the past.

You don't see the high salaries, even in high tech, you saw five years ago. There are definitely new jobs open again in software engineering, programming, network administration and systems support, Shaffer said. The best news I see for 2005 and beyond is the demand for technical workers is up again on the commercial side.

Though slow-and-steady rather than meteoric, job growth in the administrative, financial services and tech arenas is returning. We've even got open orders on file now for trainers and public relations or marketing professionals, she said. Those are typically the last fields to recover after a recession.

Based on Add-Staff's postings for mid-May, not all local orders are for temporary help.

At least 45 percent of the company's openings request permanent employees. Defense contractors began hiring in 2001-2002 with post 9- 11 developments at Northcom, Shaffer said. That accounts, in part, for a measurable increase in tech and PC support jobs.

We had 93 open orders last week and had already filed 14 of those by mid-week, she said. We'll break at least 100 open tech and PC support orders this month. I haven't seen that in years.

Kristy Morton, Colorado Springs manager for international staffing giant Westaff sees similar trends in her office.

At least two-thirds of our placements are still temporary or temp- to-hire, but we're starting to see a real increase in open positions, she said. Fortunately Colorado Springs attracts a lot of well-educated professionals, which means more recruiting for new jobs.

Morton also estimates her business could grow as much as 15 percent this quarter over last year.

The larger a company, the more likely it is to use staffing services.

An ASA poll of 500 businesses found that 12 percent of companies with 25 to 99 employees used staffing services, compared with 24 percent of companies with 100 or more employees.

Ninety percent of global companies use staffing services - most often because it allows them flexibility to upsize or downsize as the volatile economy dictates.

The survey showed that companies use staffing companies as a way to fill in for absent employees or temporary vacancies (80 percent); to provide extra support during busy times or seasons (72 percent); to staff special short-term projects (68 percent); or, as they look for permanent employees (59 percent).

So why are staffing services flourishing so early on the economic recovery curve?

The experts say the built-in flexibility of the industry lies at the root of the industry's success.

According to the ASA survey, 64 percent of temporary workers said flexible scheduling is important to them, 28 percent like the option to pursue other interests and 43 percent said they need time for family.

The American Academy of Forensic Sciences, headquartered in Colorado Springs, may be typical of today's small employers who turn to staffing services to keep operations running smoothly.

Kimberly Wrasse, membership services coordinator, is responsible for hiring administrative employees.

We usually have 11 people on staff and have added two temp-to- hire employees for the last few months. We also hire temporary personnel to help with seasonal preparation for our annual meeting, she said. This works well for us because we can see candidates perform on the job, and we can find out if they're a fit with our organization.

Wrasse echoes PeopleSoft Vice President Carl Steffen, who was recently asked about his company's global competitiveness.

We are working to develop an agile, adaptable work force that embraces change and aligns itself quickly to stay competitive, he said.