In our April forecast update, we project revenue in the US engineering temporary staffing market to grow by 4% this year, an upgrade from our 3% forecast in September.
This segment returned to growth in 2017 as revenue increased by 4%, driven by sustained demand for highly skilled professionals in a tight labor market. Engineering spending rebounded at a stronger rate than initially forecast, and many staffing firms noted increased demand in the second half of 2017. This, coupled with an improving macro-economic climate, ensured a strong end of the year.
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Important demand drivers remain intact in the form of engineering technologies with significant runway for enterprise adoption, including additive manufacturing, robotics and automation and the wider development of what is termed "industry 4.0."
High-level engineering talent remains in short supply, creating recruiting challenges but simultaneously enhancing the value of staffing services, both in the form of permanent hiring and in providing contract labor to fill the gap in interim hiring needs. Despite the scarcity of candidates, there remains a clear opportunity for firms that can build and maintain relationships with the most in-demand candidates and provide them with the most attractive opportunities. Additionally, there is market opportunity for staffing suppliers that elevate their offerings from commodity to value-added services.
Due to this candidate shortage, we have seen broadly (but not universally) reported signs of bill-rate increases. Further bill-rate increases could support revenue growth and help offset any declines in volume due to labor scarcity.
SIA's corporate members can access the full forecast report by clicking here. Our forecast report is updated twice annually with the next report scheduled for September. Staffing firms in the engineering space, as well as those looking to enter this segment, can use this report to understand the market dynamics driving its growth and identify opportunities in this arena.
