The latest data from the American Staffing Association (ASA) reveals that U.S. staffing companies employed an average of 2.1 million temporary and contract workers per week during the third quarter of 2024. Despite this figure, staffing employment experienced a slight decline due to a cooling labor market. This marks the seventh consecutive quarter of decline in staffing employment, with both job numbers and staffing sales seeing decreases.
Key Findings from the Third Quarter 2024 Report
- Temporary and Contract Worker Employment Decline
- The average number of temporary and contract workers employed per week decreased by 38,000 jobs compared to the previous quarter.
- This represents a 1.8% drop from Q2 2024 and an 11.7% decline year-over-year (YoY), indicating the ongoing impact of a softer labor market.
- Staffing Sales Contraction
- Staffing sales for the third quarter totaled $30.7 billion, reflecting a 0.7% decrease from the previous quarter and an 11.4% drop from Q3 2023.
- This downturn continues to defy the typical seasonal pattern where staffing industry sales usually experience sequential growth from the second to fourth quarters.
- Long-Term Trend: Declining Staffing Employment
- Staffing employment has now declined for seven consecutive quarters, signaling ongoing challenges in the labor market, exacerbated by macroeconomic and geopolitical uncertainties.
- Revenue Projections for Q1 2025
- Despite the current downturn, private staffing companies project a 5.0% increase in revenue for Q1 2025, with larger companies (those generating $100 million or more in sales) expecting a more modest 2.0% increase.
- This shows optimism among staffing firms that labor market conditions will improve in the coming months.
Looking Ahead: Anticipating Growth in 2025
Despite the struggles of 2024, ASA’s CEO Richard Wahlquist expressed optimism for the staffing industry’s future. After the post-pandemic hiring surge, businesses are now adjusting to a more stable talent supply. With expected normalization in the labor market and anticipated increases in labor demand across a broader range of sectors, staffing companies are preparing for growth in 2025.
