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(Adds CEO comments, shares, details)
By Sara Webb
AMSTERDAM, Oct 25 (Reuters) - Dutch staffing firm USG People beat forecasts for third-quarter operating profit on Friday, flagging a pick-up in Europe which it expects to continue in the fourth quarter and pushing the shares up nearly 5 percent.
The staffing sector is generally considered a barometer for economic health because companies tend to hire temporary staff at the beginning of an economic recovery when most businesses are reluctant to add to their permanent headcount.
Chief Executive Rob Zandbergen told Reuters the recovery was being led by logistics firms and companies producing semi-finished goods, and that the same positive trend was evident in all the countries - the Netherlands, Belgium, France and Germany - where USG People now operates.
"We are extremely well placed to take advantage now that the markets seem to be picking up," Zandbergen said.
"The positive signals that emerged during the previous quarter persisted in the third quarter. A number of early-cyclical sectors returned to revenue growth in the third quarter."
Zandbergen added he expected to turn to overall revenue growth in the fourth quarter given the current momentum.
USG People's shares rose nearly 5 percent to hit 8.883 euros, the highest since August 2011. The stock was up 3.15 percent at 8.73 euros at 0753 GMT.
Earlier this week, ManpowerGroup Inc, the world's No.3 staffing company, reported a 50 percent jump in quarterly profit due to cost cutting and improved hiring trends in Europe, and forecast current-quarter profit above analysts' expectations.
USG People has cut costs and sold operations in Spain, Italy, Poland, Switzerland, Luxembourg and Austria to Dutch rival Randstad in April because it did not have sufficient market share.
USG People said underlying earnings before interest, tax and amortisation (EBITA) rose 2 percent to 23.1 million euros ($32 million) in the third quarter, while revenue fell 3 percent to 599.4 million euros.
In a poll of four analysts commissioned by Reuters the average forecast for EBITA was 19.5 million euros, with estimates ranging from 17.9 million to 21.0 million euros. Quarterly sales were forecast at 592 million euros. ($1 = 0.7245 euros) (Reporting by Sara Webb; Editing by David Cowell)