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WSJ: Employers Turn to Temporary Help
One bright spot of Friday’s gloomy jobs report was the surge in temporary hires. Companies are hiring more temps with plans to convert them into full-time workers if economic conditions improve.
Temporary help services added 44,000 jobs since July, including 34,000 last month, according to the Labor Department. That’s the exact same number of temp jobs lost between January 2008 and July 2009.
Earlier this week, U.S. factory orders climbed 0.9%, the Commerce Department said, the fifth increase in six months. Also, the Institute for Supply Management, a private research group, reported that hiring in manufacturing increased for the first time in more than a year, with its employment index rising to 53.1 last month from 46.2 in September.
Staffing firms say employers are turning to temporary help in lieu of regular hires until they can be certain that a more permanent investment will pay off. Demand is strongest in technology, tax accounting, compliance and customer service.
“They’re saying, we want to find somebody who, if things go as planned, could transition to our books,” says Brett Good, a district president for Robert Half International Inc., a staffing firm based in Menlo Park, Calif.
Employers tend to grow their permanent white-collar work forces following a rise in demand for temps, says Jeff Joerres, chief executive officer of Manpower Inc. “There’s a step function to it,” he says. “One leads to another.” But when such a trickle effect might happen remains unclear, he adds.
Two and a half weeks after joining Zrii LLC, a small health-beverage company in Draper, Utah, as a temporary accountant in January, Maylene Peck was hired as a regular employee. She says the job pays a salary 10% greater than what she had been earning in her last position, which she was laid off from in October 2008.
Initially, Ms. Peck, 40 years old, says she was opposed to doing temp work — even after three months of job hunting proved fruitless — because she assumed it wouldn’t pay more than what she was getting in unemployment benefits. But a recruiter for Robert Half, who found her resume on a job board, convinced her to consider a temporary assignment that required expertise in an accounting software program she’s proficient in.
Ms. Peck admits she almost changed her mind on the way to the interview. “In the back of my head, I wasn’t really interested,” she says. Now she’s glad she stuck it out and has new perspective on temporary employment. “Anyone who’s having a hard time finding a job should consider a temp agency,” she says. “It’s a way to get your foot in the door.”
For now, staffing firms say employers are still being cautious about growing their work forces. But they’re loosening their purse strings when it comes to temporary help because of the cost savings and potential future benefits.
By recruiting workers initially on a temporary or project basis, employers can avoid paying health-care and retirement expenses while evaluating performance and cultural fit, says Roy Krause, chief executive officer of Spherion Corp. “It’s a try-before-you-buy situation,” he explains.
Further, should business turn sour down the road, laying off temporary talent can be less psychologically damaging to a firm’s workforce than firing staff employees, adds Jeffrey Wenger, associate professor of public administration and policy at the University of Georgia. “It has a much smaller effect on the morale of your permanent staff,” he says.
To be sure, temporary staffing firms note that the recent increase in job orders for short-term workers includes seasonal help. “We’re seeing a big demand with retailers right now,” says Joanie Ruge, senior vice president for Adecco Group North America. But she adds that it’s common for a small percentage of seasonal jobs – which include mainly online and store sales, customer service, inventory, accounting and technology — to be converted into staff positions.
Despite the potential for long-term employment, some professionals overlook temporary job opportunities during their searches because they’ve held staff positions their entire careers, says Joy Moore, a career coach in Albuquerque, N.M. “They don’t think about it. They’re very focused on finding permanent jobs,” she says.
Some also falsely assume that temporary jobs are all low level and require minimal skills, adds Ms. Moore. But in reality, these include management and above positions that demand extensive business experience and college degrees or greater. “It’s definitely an area people should be looking at,” she says.
Even a job offer doesn’t come about a result of a short-term assignment, the experience can help lead to one elsewhere. Trevor Eiler, 23, accepted a temporary visual-design job at a staffing firm after graduating in May 2008 from the Milwaukee Institute of Art and Design. During the stint he befriended another temporary worker who later landed a staff position at Jigsaw LLC, a small ad agency in Milwaukee. In July, that person recruited Mr. Eiler to join him at the firm as a junior interactive designer.
Write to Sarah E. Needleman at sarah.needleman {at} wsj(.)com