Business is picking up. The latest indicator shows
a significant increase in the use of temporary workers.
Employers need people to get the work done, but
managers are not allowed to add "headcount" yet. The increase in
business has not been sustained quite long enough to authorize hiring
permanent staff again. Even though the companies are still under
hiring freezes, they can hire temporary employees without a long-term
commitment. Those temps get the job done. They're more expensive
per hour, but that's all right for the short-term.
The current phenomenon repeats what happened in
the 1990s before the boom economy kicked in and generated a tight
labor market by the end of the decade. The increased use of temporary
employees— at all levels— is a precursor of the shift toward hiring
permanent employees again.
Layoffs, downsizings, restructurings, and reorganizations
have put a lot of people out of work. In today's depressed job market,
many people are frustrated and disillusioned because they can't
find another job as easily as they could during the late 1990s.
This condition is a short-term situation, but people need to put
bread on the table. So, many workers are taking temporary employment
assignments to earn what money they can.
There's another aspect to this picture. A high
proportion of temporary workers is actually looking for permanent
full-time work. Under the temp-to-perm arrangement, people can use
temporary assignments to gain full-time jobs. Does it work?
According to Adecco, the largest temporary employment
agency in the world, leveraging temporary jobs to permanent assignments
does work. In a study conducted in the 1990s, during an economic
period comparable to 2002, 85 percent of temporary workers desiring
full-time permanent work found those jobs within six months. While
most of these were conversions in the employing companies, others
did find jobs outside their temp jobs. The overall statistic is
meaningful, and we anticipate that we will again see this kind of
The increased use of temporary workers is a good
sign for the economy, and it's a good sign for people anticipating
the transfer from temp to perm.