TEMP TURNAROUND

Orange County employment agencies have seen a surge in revenue, marking their first up year since 2001.

The 20 largest employment

Last year the best they could muster was a 1% decline in revenue. In 2002, the agencies on our list saw revenue drop 11 % as employers slashed temporary workers amid the failing economy.

Half of the companies on this year's list reported higher revenue for the period. Six reported lower revenue. Numbers for four agencies are Business Journal estimates.

Without estimates, the other 16 companies grew revenue 11% to $676.8 million.

The list ranks agencies based in OC or with offices here by their locally generated revenue.

Employment agencies can be a leading indicator of economic trends, particularly when it comes to temporary hiring. Companies cut temps first in a downturn and hire them first when things start to ramp up again.

The number of temp worker placements by the agencies rose 6% to 389,610 workers. The number of people employed directly by the agencies grew 6% to 1,029 people.

Melville, N.Y.-based Adecco Employment Services, part of Switzerland's Adecco SA, tops the list again this year. With 20 OC offices, including a regional headquarters in Laguna Hills, Adecco posted $122.3 million in revenue, up 4% from a year earlier.

No. 2 Spherion Corp. moved up four spots on this year's list, showing the biggest revenue gain on the list-by both revenue and percentage-with a 65% surge to $106 million.

"We're seeing significant growth in a lot of industries, such as healthcare and call centers," said Lisa Pierson, Spherion's territory vice president.

Temporary placements are driving growth, Pierson said, as employers take their time before hiring permanent workers.

"We're seeing some caution right now with making full-time hiring decisions, which is helping the temp side of our business," she said. "People are taking a wait-and-see attitude with the November elections and with the economy, too. There is uncertainty about the economy, because people are seeing good news and then the stock market not responding."

No. 6 Aliso Viejo-based Remedy Temp Inc. fell a notch on the list, with OC revenue dropping 6% to $60.6 million.

"We pruned some of our high-risk heavy industrial accounts," said Greg Palmer, chief executive and president of Remedy Temp. "But our other businesses are up, including high-end finance and accounting, high-end clerical and IT."

RemedyTemp predicts a 10% uptick in national temp hiring through the remainder of the year, Palmer said.

"We'll be a little more than that this quarter in Orange County," he said.

The temp hiring could mean permanent hiring throughout the economy is on the way, according to Palmer.

"Our permanent placement business is stronger than it's been in two or three years," he said.

No. 7 Irvine-based Kimco Staffing Services Inc. grew revenue 18% to $56.6 million for the 12-month period.

"We're starting to see a turnaround that we haven't seen in years, with growth in all our divisions," said Kim Megonigal, president of Kimco. "Industrial is coming back the fastest, while clerical has made the slowest comeback."

In a sign of the turnaround, Kimco is flying red flags from its Irvine headquarters next to a banner saying: "We have jobs."

But this turnaround may not be as dramatic as prior ones, according to Megonigal. For one, he said, Internet productivity has reduced the overall number of administrative positions in the workplace.

Megonigal also said he thinks uncertainty about the coming November presidential election is causing some hiring hesitancy.

"I'm talking to a lot of people that are concerned about the election coming up, but that could actually be helping us," Megonigal said. "People could be using more temps until they know the economy is turning and the political situation is stable enough."

Debuting at No. 12 is Santa Barbara-based Select Personnel Services, which recently bought the troubled agency Checkmate Staffing Inc. of Orange.

Select Personnel officials declined to provide numbers. The Business Journal estimates the company had $20 million in OC revenue for the 12-month period.

A big gainer was No. 13 Philadelphiabased CDI Corp. The company moved up five notches from last year, thanks to a 47% gain in revenue to $17.6 million.

"Last year we saw a big uptick in defense and aerospace placements," CDI regional manager Robert Steuernagel said. "We also started to see more IT spending."

Steuernagel said he expects continued growth this year.

"In general, demand in all categories is rising," he said.

Besides Select Personnel, the other newcomer on the list is No. 19 El Segundo-based Outsource Technical. The company reported a 7% dip in revenue to $7.6 million.

Along with Checkmate, Minneapolis-based Pro Staff Personnel Services, last year's No. 14, fell off this year's list. The company no longer operates in California.