Improving business sentiment and recovering unemployment will drive demand
Los Angeles, CA (PRWEB) October 23, 2013
The Office Staffing and Temp Agencies industry supplies businesses with workers for predetermined periods of time, in order to supplement existing staff. Temp workers remain employees of the Office Staffing and Temp Agencies industry because they are responsible for payroll and are the legal employer, but they do not provide direct supervision of clients at work sites.
Over the past five years to 2013, the industry has fluctuated because of strenuous labor market conditions in the United States. According to IBISWorld Industry Analyst Jeremy Edwards, “The onset of the recession caused many businesses to restructure operations including downsizing staff numbers in order to resuscitate flailing profit margins.” As a result, industry revenue fell 4.0% and 17.9% in 2008 and 2009, respectively. However, the industry was quick to recover and revenue grew 15.6% in 2010, as corporate profit rebounded and business confidence increased. Furthermore, although many companies were expanding operations following the downturn, outlook remained cautious. More firms reduced risk with smaller commitments to staff, using temporary staff instead of permanent full-time employees. The industry is expected to grow an annualized 2.4% during the five years to 2013 and revenue is forecast to grow a further 2.2% to $126.9 billion in 2013, as a result of falling unemployment and increased demand for temporary workers.
During the next five years the industry is expected to continue to perform well. Improving macroeconomic conditions such as falling unemployment, increased private investment and rising consumer confidence will precipitate a larger workforce, including the addition of more temporary workers. However, businesses are also expected to remain cautious despite recovery, which suggests that more companies are likely to hire temporary workers rather than full-time permanent staff, avoiding commitments providing salaries and health benefits. Business and professional services and healthcare are expected to help drive this growth. “The introduction of the Patient Protection and Affordable Health Care Act will likely drive demand for new contract positions from its introduction in 2014,” says Edwards. New agencies are also expected to enter the industry and cater to narrow geographic markets and niche industries. Overall, industry revenue is projected to grow in the five years to 2018.
The Office Staffing and Temp Agencies industry is highly fragmented. The level of concentration is low; a large proportion of the industry is made up of nonemploying firms that cater to niche areas or particular geographic regions. Meanwhile, the largest players in the industry are multinational firms that have operations across the United States, Europe and Asia. The industry's largest players, Addeco SA and Randstad Holding nv, are based abroad and US operations represent only part of their business.
For more information, visit IBISWorld’s Office Staffing and Temp Agencies in the US industry report page.
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IBISWorld industry Report Key Topics
The Office Staffing and Temp Agencies industry supplies businesses with workers for limited periods of time in order to supplement existing staff. Although temp workers remain employees of the temp agency, temp agencies do not provide direct supervision of their employees at clients’ work sites.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalization & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
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