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Temp jobs falling usually signals a recession. Maybe not this time.

Meghan McCarty Carino Oct 5, 2023
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Following an explosion of temp jobs during the pandemic, many positions were made permanent as companies scrambled to recruit and retain workers. Above, participants at a San Francisco job fair. Justin Sullivan/Getty Images

Temp jobs falling usually signals a recession. Maybe not this time.

Meghan McCarty Carino Oct 5, 2023
Heard on:
Following an explosion of temp jobs during the pandemic, many positions were made permanent as companies scrambled to recruit and retain workers. Above, participants at a San Francisco job fair. Justin Sullivan/Getty Images
HTML EMBED:
COPY

The September employment report comes out Friday, and it’s likely to show a job market that remains pretty resilient, even if it is cooling down a bit. Most industries are still adding jobs, just at a slower rate than before. But one industry that has seen consistent drops in employment this year is temporary help services — staffing agencies that supply temporary workers to a myriad of different business types.

Temp jobs have fallen every month this year — down by 242,000 since their peak in March of last year. It’s a trend that sometimes signals a recession on the way, but it’s a little harder to read these days.

Temporary work can include anything from doing inventory of car parts, overseeing parking operations at state fairgrounds, answering phones at a traffic control company or dealing cards for a casino party. And temp worker Alexandra Golden in Tampa, Florida actually juggles all of those jobs — sometimes two of them in a day.

“There’s a whole world of jobs out there that will take you on an as-needed basis, and luckily, I have five of them,” said Golden.

With the aid of a color-coded, dry erase board calendar and a sense of adventure, Golden said that she’s been able to cobble together a pretty good living working temporary jobs since 2017. She gets paid around $15 to $20 an hour — a few dollars more than before the pandemic.

For some jobs, she’s hired directly, but others are through a temp agency that calls her on the behalf of other companies.

Temp work has been around forever, but the industry to supply it on a broad scale really got going with the rise of management consulting in the 1970s and ’80s, said David Weil, a professor of economics and policy at Brandeis University and author of “The Fissured Workplace.”

“The word of that day was ‘focus on your core competency,'” said Weil. “Do what you’re really good at and shed everything else.”

That means jobs in payroll or janitorial services, software testing and development are now regularly outsourced to a web of subcontractors, often on a temporary or on-demand basis.

And the ebb and flow of this workforce can be an early signal of a coming recession, said Ron Hetrick, senior labor economist at analytics firm Lightcast.

“The first thing you do is you let go of your kind of flex staff, because the cost of letting go your permanent staff are way higher,” he said.

But this time around? “Everything we’ve been experiencing has never happened before,” said Hetrick.

Like companies laying off all their workers and then needing to hire them back really quickly. That led to an explosion of temp jobs during the pandemic. Many of those positions were made permanent as companies scrambled to both retain and attract workers.

Given this, David Weil said despite that whole thing about sticking to “core competencies,” we could be seeing a shift in the trend of outsourcing so many jobs to staffing agencies.

“Workers are not going to be satisfied and employers are realizing that they have to make bigger commitments to their workforce if they want to retain them,” said Weil.

But the temp industry is still bigger than it was right before the pandemic began, and it works for some people — like Alexandra Golden, who said she’ll keep her five jobs.

Despite the uncertainty and lack of benefits, she enjoys the variety and the flexibility of never getting pinned down.

“Today is my first day and tomorrow is my last day,” Golden joked. “Which is kind of nice. Like, I never truly feel burnt out working all of my jobs.”

Even if they do require some advanced color-coded calendar managing skills.

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