| NEW YORK, March 9
NEW YORK, March 9 Companies that provide
temporary labor are seeing more contract workers hired as
permanent employees, in a sign job gains may be broadening as
U.S. employers gain confidence in the recovery, staffing
executives said Friday.
Companies typically engage temporary workers before
committing to permanent hires, so the staffing sector is seen as
a leading indicator of broader hiring.
The sector added 45,000 jobs in February, while temp job
gains in January and December were stronger than initially
estimated, the government report showed on Friday. The job gains
were part of a broader jobs report that showed 227,000 jobs
added outside the farm sector.
The percentage of temps in the U.S. labor force, at 1.86
percent, marked the eighth straight monthly increase. Employment
analysts expect that metric to pass its April 2000 peak above 2
percent as more employers embrace temporary labor in an
uncertain economic climate.
Companies are using temps to try out candidates for
permanent jobs, said Jeff Joerres, Chief Executive of
"Our temporary to permanent conversions are very high,"
Joerres said. Taking on temp workers "is also is a way of being
agile and cautious, so if something happens in the Middle East
and demand goes down precipitously, (they) have a way to adjust
without affecting the permanent workforce."
'ROBUST' DEMAND BUT FLAT WAGES
Small and mid-size companies are stepping up use of
temporary workers as easier access to credit allows them to
invest, said Randstad employment analyst Joanie Ruge, who said
pharmaceutical companies are using more temps for research and
"It is robust," Ruge said. "Companies are going to look for
more flexibility in their workforce. They will expand and
contract as their demand fluctuates."
While demand for temps is strong, it is not necessarily
accelerating, said Joel Capperella, vice president of Yoh, a
Philadelphia-area staffing company that focuses of professional
job categories such as technology. Wages are flat. A Yoh index
of wages for skilled temporary workers found only a 1 percent
gain over a year ago.
"Wages aren't really moving a whole lot," Capperella said.
"Clients of our services are in the driver's seat. Things are
good but you have to temper it."
Staffing stocks were higher across the board in U.S. and
European trading and far outperformed the broader market on
expectations that growth rates would pick up for the sector in
Manpower shares gained 2.3 percent in midday trading. Robert
Half International rose 1.6 percent, Hudson Highland
jumped 7 percent and TrueBlue Inc, which
focuses on blue-collar jobs, was up 2.4 percent.
In European trading, Adecco, Randstad
and Michael Page each gained more than 2 percent.