Jobs—Temporary versus Permanent Positions

By: Dr. Lynn Reaser

Given the recent, disappointing jobs growth report, are many companies getting too used to a lean permanent workforce and will depend on temporary workers for the foreseeable future?

Although firms tapped temporary staffing firms about six months before permanent hiring started in March 2010, temporary hiring has declined during the past three months, while permanent private sector jobs have expanded further.  Thus far in the recovery, temporary help has grown by fewer than 500 thousand jobs, while over 1.9 million positions have been added to companies’ direct payrolls.

Firms can rely on productivity gains only so long before customer service begins to suffer.  However, firms will need to see a more stable policy environment and a more consistent improving trend in their own businesses before we can expect stronger gains in permanent workforces.


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