Can Staffing Companies Predict an Economic Recovery?

During a recession, hard-hit businesses cut expenses to stay profitable. For the vast majority of firms, the largest expense is the payroll of its employees. Once orders begin to pick up, firms often turn to staffing companies to provide temporary workers before they hire permanent employees.

Conversely, when times are tough, temporary workers are often the first to be let go. Labor economists consider employment through these firms to be an important leading indicator of future economic conditions.
If job loss in the employment services industry can signal a coming recession, might job gains in the sector be a premonition of economy-wide job growth? Data suggest that it can. Employment services began growing in the U.S. in the spring of 2003, four months before the last national job recovery took hold. The Oregon trend looks similar, with employment services growing in early 2003, followed by statewide increases in job numbers during that summer.

Other indicators of economic recovery include construction and the unemployment rate. Find out more in the full article, "When Will the Economic Recovery Begin? Watch These Indicators!" written by our very own Christian Kaylor, a Workforce Analyst in the Portland metro area.