Despite Strong December, Temp Has Slow Year

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Jan 8, 2016
This article is part of a series called News & Trends.

A strong jump in temp staffing last month helped boost overall December hiring to the second strongest month in a year as employers grew payrolls by 292,000 workers.

The Bureau of Labor Statistics reported this morning that with December’s strong numbers — far above the 215,000 average of analysts’ estimates — and the 50,000 job increase to October and November’s reports, 2015 saw 2.7 million new jobs added to the national economy. It was the second largest increase since 1999, falling just behind last year’s 3.2 million.

The unemployment rate remained unchanged from November at 5 percent. It was 5.7 percent at the beginning of 2015.

Most sectors of the economy saw strong jobs growth during the month, with construction, healthcare, bars and restaurants and temp staffing leading.

“The remarkable thing is how consistent employment growth has been over the past three or four years,” said Mark Zandi, chief economist at Moody’s Analytics. “We’re getting at least 200,000 jobs per month on a consistent basis. That’s quite an achievement.”

However, for the temp industry, 2015 turned in the slowest growth in six years. Even with a 34,400 increase in temp hiring last month, the year was sharply off from 2014. The 94,500 overall increase (seasonally adjusted)  in temp staffing in 2015 was the smallest growth since 2009, when the industry lost 151,300 jobs. By contrast, temp staffing increased by 174.4 last year.

Executive search Nov 2015Executive search firms in November (the most recent month for jobs data) had 40,300 workers, down from a seasonally adjusted high of 41,200 in September.

For temp staffing, January is unlikely to show improvement in hiring.  The month, typically, has a decline in temp staffing, as companies shed workers brought on to help with holiday shopping and year-end activities. Macy’s announced this week it was laying off 4,500 workers. And the government’s report this morning showed clothing and clothing accessories stores cut 17,500 jobs in December.

The American Staffing Association’s Staffing Index stood at 92 at the end of December, a sharp decline from the 103 it posted earlier in the month and below the same week in 2014.

Similarly, SHRM’s LINE report predicts hiring will decline this month. “For the first time in seven months, the hiring rates will fall in both sectors when compared with the previous year. Layoff rates will also rise in both sectors when compared with January 2015,” says the report.

On the other hand,  Andrew Chamberlain, chief economist at Glassdoor Economic Research, told The New York Times, “Looking forward, January is the best time to be looking for a job. There’s always a big jump in labor demand in January.”

Emp Indices Dec 2015Despite these question marks, December’s robust hiring suggests employers discounted the rise in interest rates. While mining and the petroleum industry continued to shed jobs (down by 8,000), every other major sector showed an increase. Manufacturing even eked out an increased of 8,000 jobs.

In other sectors:

  • Construction +45,000
  • Transportation and warehousing +23,100, lead by a jump in employment of couriers and messengers +15,100.
  • The motion picture and sound recording industry added 15,200 workers.
  • Finance and insurance +9,600.
  • Temporary help +34,400.
  • Healthcare +39,400 with ambulatory health care services accounting for 23,400 jobs. Hospitals added 12,300 workers.
  • Bars and restaurants +36,900.
This article is part of a series called News & Trends.
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