It’s not a good omen. Like everything else that is related to the economy, temporary worker usage has stalled. The number of U.S temporary help jobs was flat in July.
As we came off the recession, that number spiked and held strong for a while; now it’s just another indicator that future is uncertain.
Let’s take a look at recent events. Standard & Poor downgraded the United States credit rating and the U.S. stock markets plunged in response.
Meanwhile, indicators such as the Economic Cycle Research Institute (ECRI) weekly index are showing no clear signal for growth, while the Institute for Supply Management’s manufacturing Index shows a sharp drop in activity, indicating that the manufacturing segment is on shaky ground. Further, the Euro zone is being plagued by fiscal problems. Greek bond interest rates have spiked; there’s a cash run on the banks there. Spain is going the way of Greece and economic rumblings are beginning in Italy, the world’s eighth largest economy.
The world is a scary place. In response the business world seems to be waiting and watching before making any investments.
So it’s little surprise that temp employment is flat. That having been said, the global economy is not homogeneous. The middle corridor of the United States — Texas, North Dakota, and Wyoming — is faring well. And there are other areas worldwide that are experiencing a shortage of skilled information technology and healthcare workers. In fact unemployment among the college educated is just 4.2 percent in the United States, compared with 15 percent for those with a high school diploma.
So in times of economic uncertainty, what are your options? I would hire more contingents. Get your projects done at competitive prices without increasing headcount. If there’s one thing that the last few years have taught us, it’s that it pays to have flexibility — access to a labor force that you can ramp up or down.