Companies see Temps as Permanent Solution

Overall, temporary help payrolls are up by almost half a million since they bottomed out in September 2009, according to the department of Labor. Lots of companies are relying more than ever on temporary workers to fill their employment needs. In the past, the increase in the use of temporary workers indicated that it wouldn’t be long before we saw an increase in the permanent job market. In previous recessions, companies simply laid off workers and then hired them back again when the recession was over. Thing is, lots of businesses found that they just kept running into the same problems each time the economy ran into trouble.

Many analysts are predicting that we’re at the beginning of a permanent, structural shift towards temporary workers making up a large proportion of the labor force. Interestingly, whereas temporary job opportunities have previously been mostly light industrial or clerical in nature, this time around, jobs in Legal, IT and other professional industries are shifting towards a contract/freelance model as well.

Are employers wary of hiring full-time employees because of the uncertain economy? Most certainly. But they are also likely to be unwilling to commit to the seemingly never-ending hikes in health insurance costs too.

Hiring temporary workers is being increasingly seen by many as a cost-effective solution to a staffing problem, enabling companies to scale up or down quickly to meet demand without an enduring obligation to the temporary worker. However, navigating complex co-employment rules and the new stringent IRS 1099 classification requirements, means that employing temporary workers is becoming fraught with risk – for both the company working with the temporary workers and the staffing company who recruits the those workers.

Emergent can provide stable contingent workforce solutions that allow staffing companies and their clients to recruit workers, while Emergent takes care of the rest (including legal, payroll, invoicing, insurance, tax, HR and workers’ comp administration). To find out more, e-mail us at  info@emergent.com or visit us at www.emergent.com.

Temporary Jobs Seen as Likely Path to Permanent Hire

More than half of U.S. adults (54%) agree that finding a temporary job is the best option following a layoff, according to a new online survey commissioned by EmploymentGroup, a Midwest staffing and contracted services firm, and conducted by Harris Interactive®. The poll coincides with the latest Labor Department payrolls data that show U.S. employment rose far less than expected in January, suggesting continued weakness in the job market.

The survey, which aimed to quantify the appeal of several frequently cited options available to unemployed workers, found that pursuing a temp job (defined as a transitional job held while looking for permanent employment) is preferred by a wide margin to going back to school to learn a new skill or profession (21%), waiting for the right opportunity while receiving unemployment assistance (11%), starting a new business (5%), or something else (8%).

The survey also examined the perceived value of temporary employment. A majority of adults (70%) say that landing a temp job often leads to a permanent position, and 74% agree that it adds value to a resume – an opinion voiced most strongly by unemployed (78%) and retired (85%) workers. The online survey of 2,026 adults aged 18 and over, was conducted in January 2011.

"While it has been widely reported that temp hiring is up, some have suggested that in the current economy traditional perceptions of the temp job have changed – from a potential path to full-time employment to just another dead end," said Mark Lancaster, CEO of EmploymentGroup. "These latest survey results paint a different picture. Despite significant, persistent challenges in the job market, public opinion regarding the value and long-term career potential of temporary employment remains strong.

The survey provided some additional interesting findings regarding perceptions of temporary employment:

· Women are more likely to agree that temp jobs often lead to a permanent position (74%), versus men (66%);

· Temp jobs hold more appeal for older women: 63% of women ages 55 and older feel temporary employment is the best option following a layoff, versus 56% of all adult women and 51% of men ages 55 and older;

· Across all household income categories, the temp job option holds the most appeal for those earning between $35,000 and $49,900

· Part-time workers are much more likely to agree temp employment is the best option following a layoff than full-time or self-employed workers (63% vs. 53%);

· Ranges in U.S. geographic region and household size didn't seem nearly as relevant in predicting perceptions regarding temporary employment as gender, age and employment status

Why Is The Contingent Workforce Experiencing Such Rapid Growth?

Growth is a seldom used term in
today's economy, however the
contingent workforce has been
growing rapidy.

Research indicates that one third of the U.S. work force is now comprised of Contingent Workers, who are sometimes referred to as freelancers, contractors or temps. This group of workers is growing at more than twice the rate of the full-time work force and the trend looks set to continue into the foreseeable future (Contract Talent: An Imperative for Talent Management in the New Normal, The Human Capital Institute, 2010).

Contingent workers provide convenient, flexible, specialized skills that best fit the changing needs of the modern workplace. Here are the top three reasons companies are choosing to hire temporary employees:

Savings on time and money 

Contingent workers are normally employed by the staffing company that sourced the worker or via an Employer of Record service like Emergent (www.emergent.com). This means that all of the responsibilities of an employer, such as payroll, insurance, legal, HR and benefits administration rest with the staffing company or the Employer of Record – saving the client company time and money.

Short term help

Many companies have a significantly smaller staff that they had a couple of years ago. Yet the same amount of work (or more!) has to be done. Hiring contingent workers on a project basis to help during busy periods with no obligation to continue to work with the contractor after the project is complete.

Opportunity to “try before you buy”

Hiring a contingent worker on a temporary basis with a view to filling a permanent role is becoming increasingly common. It allows both the company and the contingent worker to ensure that they are the right fit for each other. If not, the company is free to end the contract at the end of the trial period without any further obligation.

About Emergent

Emergent provides industry-leading contingent workforce services that help clients save money, decrease risk, and reduce the time taken to find and utilize high-quality talent. Our team will handle all payroll, tax remittance, human resource management, invoicing, accounts receivable, and workers’ compensation insurance at a significantly lower cost. We can also provide contingent workers with access to personal health benefits.

To find out how Emergent can help your company reduce the risk and cost of utilizing contingent staff, complete our information request form or call 855-250-5000.