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Contingent labor buyers warming to extra ACA costs

May 05 2014

Buyers of contingent labor are beginning to accept the inevitability of extra costs brought on by the Affordable Care Act, according to a new survey by Staffing Industry Analysts. Buyers and staffing firms are also relatively close on what that extra cost should be.

The percent of buyers who expect to pay no share of ACA costs fell to 36 percent in the new survey of staffing buyers — down from 62 percent in a similar survey in 2012.

“I think a lot of frank conversations have been going on between buyers and staffing suppliers, and a gradual compromise between the two sides is under way," said Jon Osborne, co-author of the report. "Buyers who had initially said they would not accept any bill rate increase at all are shifting away from that stance.”

Co-author Tyler Womack added, “It’s also worth noting that the remaining buyers who expect no additional charge are disproportionately professional staffing buyers, many of whom are already paying for temp insurance built into rates, so for them the ‘no increase’ position is less unreasonable.”

And when asked how much they expect bill rates to increase, the median response from buyers was $1 per hour. In a separate survey of staffing firms, the median response was $1.50 per hour when staffing firms were asked to calculate the extra cost of ACA.

The buyers survey also found that relatively few favored “avoidance” strategies when responding to the ACA with only 5 percent indicating they preferred such moves. Avoidance strategies include limiting assignment lengths of agency temporary workers or limiting agency temporary workers to less than 30 hours per week.

The buyers survey included respondents from 171 large companies (with more than 1,000 employees) that use temporary labor.

Corporate members of Staffing Industry Analysts can access the full report by clicking here.

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Troutman53 05/05/2014 06:54 pm

The headline is misleading, how about recognizing the inevitable.


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