Employment Services
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 30,000 employment services firms in the US offer a wide range of employment-related services and solutions, including temporary and contract staffing, permanent placement, recruiting, outsourcing and outplacement, training, and human resource consulting. The industry is organized along three distinct segments: temporary help services, employment placement agencies, and professional employer organizations.
Internet Job Services
The proliferation of Internet job boards has made it easier for companies to advertise openings and find applicants on their own.
Growth of Flexible Workforces
Companies are placing increased value on the ability to quickly adjust to market conditions.
Industry size & Structure
A typical employment services firm has about 121 employees and annual revenues of $19 million.
- The overall industry consists of about 30,000 firms and generates around $575 billion in annual revenue.
- 56% of firms have less than 10 employees.
- The top 4 firms account for over 25% of industry revenue. The largest employment services firms include Adecco, Kelly Services, Manpower, Spherion, and Kforce.
- Workers average 34.6 hours per week, comparable to permanent employees.
- Services are provided to customers in all employment segments: Manufacturing, services, and government.
- With limited capital costs associated with start-up, there is little barrier to entry into this field.
Industry Forecast
Employment Services Industry Growth
Recent Developments
Nov 4, 2024 - US Jobs Market to Cool Slightly
- Economic forecasters’ view of the US labor market is mainly optimistic, according to the most recent survey of economists by The Wall Street Journal. Overall, the panel of 66 economists’ view of the jobs situation was generally in line with the previous survey in July 2024. They expect the US employment rate will be about 4.2% by the end of the year and that the US will add an average of about 130,400 jobs per month over the next year. While the forecasters’ view does mark a slight cooling of the US labor market, they do not expect a significant increase in unemployment.
- US average shift work volume decreased by 1.9% in October compared to the prior month, according to data compiled by HR solutions firm UKG. The drop in shift work was attributed to the disruptions caused by Hurricanes Helene and Milton. However, UKG noted that shift work patterns outside the affected regions were at or near the historic monthly rate. The public sector industry led the October decline in shift work with a drop of 5.3%, followed by manufacturing, which fell 2.1%. Healthcare shift work increased by 0.6% in October, and retail, foodservice and hospitality was flat. The hurricanes caused a 3.7% decline in shift work in the Southeast in October. Shiftwork also fell 1.4% in the West and 1% in the Midwest. Shift work in the Northeast was flat.
- The troubled office space market may be turning a corner as major companies require workers to spend more time in the office, according to The Wall Street Journal. Amazon, Dell, and 3M have recently issued requirements for more office time for some of their teams. In the third quarter of 2024, a third of all firms required workers to be in the office five days per week, according to workplace strategy tracking firm Flex Index. The push for more in-office time comes amid a cooling of the US white-collar jobs market, which has shifted the balance of power back to companies. While industry observers doubt if workplace occupancies will ever return to pre-pandemic levels, some believe the market may have finally hit bottom. In the second and third quarters of 2024, the amount of occupied office space has remained stable after eight consecutive quarters of contractions, according to data firm CoStar.
- In a recent poll by Flexjobs, 34% of workers said they thought artificial intelligence (AI) would lead to job displacement over the next five years. Nearly half (49%) of respondents said they do not use AI, and 21% said they use AI for work-related and professional purposes. Almost 20% (19%) of those surveyed said they rely on AI to support their job searches, including writing cover letters and résumés. About a quarter of Millennials (24%) said they use AI for professional or personal purposes, followed by Gen X (21%) and baby boomers (16%). About 9% of those surveyed said they expect AI to make their current job obsolete within the next five years.
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