With economic uncertainty creeping up since our last engineering newsletter, we take a look at what recent survey data has shown us about engineering staffing to see how the segment might fare in the second half of the year.

In the May 2022 Pulse Survey Report, April 2022 engineering staffing segment revenues were up a median 5% year over year, down from their double-digit growth levels throughout most of 2021. Forty-one percent of firms reported positive year-over-year revenue growth. Trends in new orders and gross margins were modest; a net 44% of respondents expected increasing new orders in the next six months — in line with a net 44% seeing an increase in new orders over the last three months — and a net 48% expected an increasing gross margin percentage in the next six months, up from a net 35% in the last three months.

Meanwhile, the June 2022 Jobs Report shows double-digit growth in natural resources/mining jobs in May; employment in the industry group rose to 618,000 in the month, which represents growth of 10.4% year over year. This comes after similar increases of 10.6% in April, 9.8% in March and 10.7% in February. Further, the SIA | Bullhorn Staffing Indicator for the week ended June 11 shows temporary staffing hours worked in professional occupations (IT, healthcare, finance, engineering, etc.) were up 12% year over year.

Energy markets and staffing have benefited from oil prices which remain elevated. For the most part, prices have stabilized after extreme volatility seen at the outset of the Ukraine crisis, but the trend is worth watching going forward, as prices are down from their early June highs.

We touch upon the effect of oil prices in our US Staffing Industry Forecast: May 2022 Update, where we estimate the size of the engineering staffing market as $7.9 billion at the end of 2021. The segment’s recovery lagged behind other skill segments in the initial part of 2021, but rising oil prices helped contribute to more consistent growth in the last part of the year. We estimate the segment grew 9% in 2021 and project similar growth (8%) in 2022, as healthy demand has carried over to 2022.

To get an idea on how energy markets and economic headwinds are affecting the engineering staffing market, look out for our next Pulse at the beginning of July. To participate, check for invite emails or visit our Surveys webpage.