US staffing industry revenue will shrink by 3% this year to a total of $184.6 billion, according to a new report by SIA. Helping drive the decline is travel nurse revenue, which continues to normalize after its pandemic highs. Travel nurse revenue is expected to decrease by 20% for this year. Excluding travel nurse and per diem nurse revenue, overall staffing industry revenue is expected to be roughly flat year over year with a contraction of just 0.3%.

In comparison, the staffing industry is estimated to have declined by 15% in 2023.

One explanation for the industry’s growth trajectory is that the US staffing industry is normalizing after the extraordinary upticks in 2021 and 2022 brought on by government spending in response to the pandemic, according to the report. Travel nursing grew sixfold from 2019 and 2022 amid Covid-19. Other explanations include higher pay rates reducing client demand and sectors with high usage of temps, such as manufacturing, seeing difficulty in the economy.

Looking at the revenue forecast by segment, SIA expects industrial staffing revenue to fall 5% this year, while office/clerical will hold steady. IT staffing revenue is expected to fall 3%.

There were bright spots in other segments. Education temporary staffing is expected to grow by 7% this year, and engineering staffing is expected to grow by 6%.

Looking forward to 2025, SIA forecast US staffing industry revenue will grow 3% to $189.9 billion. SIA believes the commercial segments will return to growth in 2025, while most professional segments other than healthcare will experience a mid-single-digit expansion.

Corporate members of SIA can download the full report, US Staffing Industry Forecast: March 2024 Update.