Contingent Workers Will Lead the Way

A recent article from Investor’s Business Daily reports that companies are still risk-averse when discussing their staffing plans for 2010. To reinforce their wariness we can simply look at the most recent jobless claims report. During the month of November we saw a leveling off of jobless claims, and a trend started to emerge, fueling hope that perhaps soon we’ll be seeing the addition of jobs to the market and the light at the end of the proverbial tunnel. But then the first January report was released which discounted our initial optimism. Jobless claims rose once again by nearly 11,000, breaking our 4 week streak. Our final jobless claims now idle at 444,000.

Although these changes are miniscule in comparison to our peak jobless claims of 674,000 in March of 2009, we still saw recoil from employers who’ve decided to keep their hiring plans on hold. The statistics presented exacerbate the perception of volatility in the job market and self-perpetuate the deficit of job creation. However, it’s no secret that employers have been running lean, and have thus been postponing projects that can no longer wait. So how does a skittish employer mitigate the risk of another trough in the economy but still get the job done? Contingent labor - Contractors who don’t add to the permanent headcount of the company and therefore don’t carry the risk of unemployment claims, layoffs, tax penalties, and other employment law nightmares. We have already begun to see an increase in contract labor, which is a reliable economic indicator that permanent jobs will be created within the next six to eight months or so. And furthermore, becoming a contractor is a great way for an employee to get into a company and prove their worth, which can lead to a permanent job offer.

The moral of the story? Employers have options. They can manage their risk by utilizing a contingent workforce. And for job seekers - don’t limit your job search to strictly permanent positions. You’ll be surprised by how often contractors become permanent employees of the company they work with.

Best wishes to everyone for a successful and profitable new year!

Temporary Staffing a Leading Economic Indicator

As we've seen in the news, the Jobless rate in the United States has dropped to 10%, down from 10.2% last month. And there was an astonishing decrease in the number of jobs cut by employers during the month of November. Economists originally estimated a loss of 130,000 jobs during the month of November, and boy were they wrong. In Fact, the official number rang in at 119,000 LESS than the estimate. That’s right, last month’s job cuts were “only” 11,000.

This is great news, my friends! Economists also predict this is not a fluke, and jobless rates and job cuts are expected to hold steady. Of course this is assuming they aren’t making another whopper of an error in their estimates again.

Another positive and relatively underrepresented fact is the number of temporary positions that were created last month. For the fourth consecutive month we’ve seen an increase in the number of temporary positions created. Last month alone we saw an addition of 52,000 temporary jobs.

I’m sure you’re asking yourself “So what? Why should we care if temporary positions were created, shouldn’t we be hoping for permanent positions?” Of course we want an increase in permanent positions, but what you may not know is that temporary positions are an extremely reliable leading economic indicator.

What’s a leading economic indicator, you ask? Well in this case it means that when temporary positions start being created we can usually expect, within 6 to 8 months, that we’ll start to see the creation of permanent jobs. And it usually follows suit that when jobs are created, the economy begins to improve. Don’t believe me? Here’s a quote from the American Staffing Association:

“Temporary employment clearly is a leading jobs indicator. ASA and Department of
Labor data show that when temporary jobs begin to decline, employment in general
may be headed for a downturn. Conversely, during recoveries, temporary jobs lead the
way, as the president’s Council of Economic Advisers noted in its February 2004
report to Congress:

Looking ahead, temporary-help services employment—a leading indicator for
the labor market—suggests substantial further employment growth. Average
growth in temporary help services employment over a six-month period has a
striking positive correlation with growth in overall employment over the
subsequent six months…Statistical analysis suggests that an increase of one job in
temporary help services corresponds to a subsequent rise of seven jobs in overall
employment. (emphasis added)12

The correlation between temporary jobs and general employment growth can be seen
in the 2004-2005 recovery period. In 2003, jobs growth was generally stagnant, while
temporary jobs grew by 200,000. The growth in temporary jobs continued into 2004,
presaging the general upturn in job growth that materialized in a significant way in March of that year and that continues today.”
For additional information and to view the article: http://www.americanstaffing.net/legalandgovernment/issue_papers/Staffing_Industry_Positive_Role.pdf


So finally we hear a bit of good news, which is few and far between these days. And I honestly can’t think of a better place to be than Central Texas to weather the economic fallout (well, Hawaii might be nice). I hope you all have a fantastic holiday and stay optimistic! Call or email me with any questions or comments!

Ryan Drake

To inquire about career opportunities or to request a temporary employee, feel free to call or email me.

Prospects for the Austin Job Market - a recruiter's view

Yesterday it was announced that GDP in the US grew by 3.5% from July-September, which was a higher than expected post oficially signaling that the US economy is out of its recession. However, on a national scale we are hearing that unemployment rates remain high and will do for the forseable future. I thus wanted to briefly take a look at what this means for us as jobseekers and labor allocators here in Austin.

First, the good news:

1) Labor markets are geographically differentiated - which means unemployment rates are higher in different cities, states and for different positions. Austin was one of the last cities to enter the recession, which began in 2007, and will be one of the first to recover. Here at Kelly's office, we are finding we are getting orders from customers we weren't getting orders from 6 months ago. Our customer base is also broad and dynamic, showing us that more companies are hiring, and not just the old reliables.

2) Talent is still needed. Whilst we understand that there are many unfortuante exceptions right now, we are finding that applicants with good tenure and skill sets are attending multiple interviews, some with Kelly some outside of Kelly. In otherwords, there is still a level of demand for talent.

Now the not-so-brilliant news:

1) We are finding that there has been a particular decline in Manufacturing/warehouse work, which is being slow to recover. Administrative and marketing fields also remain highly competitive. Areas where there are still a high demand for labor are in Engineering and the Healthcare field (RN, Physician etc)

2) We are finding permenant positions still a little scarce, although better than 6 months ago! We are also setting ourselves for a tough holiday season, as company budgets reach their end.

The better news:

1) Temporary and contingent work is gathering pace. We also expect to see a rise in contingent work as seasonal needs arise. This will mainly been in the form of retail work, seminar work, and admin cover.

The great news:

1) Things ARE getting better, and we are with you on the front line. Austin is one of the fastest growing and most dynamic economies in America. Know that you are in the right place and work hard on at least 10 applications a day and work will come your way.

Kelly Services Named One of America's Greatest Brands!

Standing next to brands like Campbell’s Soup, Energizer, and NASCAR, Kelly Services was named one of America’s Greatest Brands in 2009 by Brand Keys, Inc.

Kelly Services founded the staffing and recruiting industry, which has since grown into a $350 billion market. William Russell Kelly’s original business was created to transcribe and word process documents sent over by customers. One day in 1946 his biggest customer called because their receptionist hadn’t shown up that day and he desperately needed someone to fill-in. “Russ” Kelly lent his own secretary to the customer, and that’s how the concept of "temporary staffing" was created. Eventually other companies heard of his service and began calling Kelly with requests for steel workers, accountants, scientists, and engineers. Over the past 63 years Kelly Services has perfected the art of staffing and has developed the resources to successfully recruit and fill any position.

Fun Facts about Kelly Services:
· Kelly Services has been in Austin for over 45 years! (that’s even before traffic was a problem!)
· Ninety-nine of the Fortune 100 companies are Kelly customers.
· Kelly Services fills a position with a qualified employee every 35 seconds.
· Every 5 minutes a Kelly temporary employee is hired by a customer to become their employee.
· Kelly employees work 4 million hours per week.
· Kelly Scientific Resources is the largest scientific staffing provider worldwide.
· Kelly Educational Staffing substitute teachers fill more than 20,000 classrooms each week.
For additional information, or to request a Kelly employee of your own, feel free to email me at

drakery@kellyservices.com.

Have a great day!!!

Ryan Drake
Branch Manager
512-383-9320
To see other brands awarded this honor, visit www.americasgreatestbrands.com.