Temp Staffing – Barometer for Economy

Here is a reprint from Canadian HR Reporter May 2009

Staffing industry was first to feel pinch and will be first to recover
By Steve Jones

The only thing certain about this global economic recession is it will eventually end. Everything else seems unclear. Has the economy hit bottom? How long will it last? And, most importantly, where will the jobs appear in the post-recession recovery?

Governments within developed nations across the globe are strategically placing stimulus capital into sectors they believe will win in a post-recession competition. There will be winners and losers and the challenge for each government and investor is to pick the industries, regions and players that have a fighting chance to come out on top.

When the forces of the global economic recession eventually loosen their grip and trade and capital begin to flow, where will the Canadian jobs be? History tells us the winners will likely be the traditional industries of energy, mining, automotive, manufacturing and financial services, but we can also expect new sectors to emerge. And early indicators won’t be found in the stock markets but in the temporary help and contract employment markets.

While hit hard in the downturn, temporary employees will be the first to return to work in the recovery period. The temporary staffing services industry is a leading indicator of the economy, says Mary McIninch, manager of government affairs for the Association of Canadian Search Employment and Staffing Services, which promotes best industry practices for the recruitment, employment and staffing services industry in Canada.

“Our members began reporting a reduction in their hours as far back as April 2008, a full six months ahead of the dramatic declines in the stock markets and other traditional economic measures.”

On a micro level, businesses will remain cautious and uncertain about the permanency, magnitude and timing of recovery prospects. Managers won’t jump to rehire and sign on long-term permanent employees until the fog has lifted and there is visibility down the road of recovery. The first jobs to emerge will be temporary and contract. The staffing services industry will provide just-in-time skilled resources to meet staffing needs while helping businesses hedge against the uncertainties ahead.

“It’s like the hockey pre-season exhibition games,” says Rolie Hamar, president and COO of Inteqna, a staffing company specializing in information technology and accounting roles, who has been through these cycles before.

“Short-term employment contracts will give workers and managers the opportunity to check each other out and to eventually choose their roster of regular players. Many of the contractors and temporary workers will be signed to full-time employment agreements. It’s a great way to find talent, determine if there is a match and build a winning team.”

If history is a good indicator of the future, then renewed activity in the temporary services industry will signal the beginning of a broader economic recovery, says Judy Tidlund, a veteran staffing industry manager with Placement Group in Alberta.

“New temporary assignments, then shortened gaps between assignments, will be followed by longer contracts and, eventually, a return to permanent hiring.”

However, there are some who see a negative side to the use of temporary workers during a recession. When speaking in April to an Ontario parliamentary committee about the temporary help industry, Ken Lewenza, president of the Canadian Auto Workers union, cautioned that 80 per cent of the job opportunities available to his laid-off auto workers are temporary. Instead of describing this as a transitional return to work phase in the economic cycle, he said it is a “trend in the employment market that offers less security and benefits.”

But recent changes to Ontario’s Employment Standards regulations ensure temporary workers now have equal access to public holiday pay, the same as all other workers, putting a long-standing, contentious issue to rest. This is an example of how the staffing industry and various governments are raising the bar to ensure temporary and contract employment serves the needs of workers and employers in these difficult times.

Before traditional hiring and the traditional lagging indicators of recovery, such as inventories, production volumes and financials, companies will rely on flexible staffing options, often choosing temporary, contract or temp-to-perm recruitment. The staffing industry remains the best leading indicator of recovery and we look forward to the early signs.

Steve Jones is president of the Association of Canadian Search and Employment Services and president of the business services division of Design Group Staffing.

Say What You Will with Justin Hines!

Justin Hines deserves all the recognition we can give him. Every one of his new creative ventures reinforces his well established themes of benevolence, caring and empathy. His new creative work, CHASING SILVER, and the marketing campaign around it are no exception.

Justin is promoting his new album with a creative and interactive experience. You can Say What You Will (Before It's Too Late) by sending a customized message to a friend or relative along with Justin's new music video. In keeping with a similar theme to his previous music video success "April on the Ground", his new video captures the genuine emotion of everyday humanity. That's us!

Justin's new album, CHASING SILVER , will be released through Walmart locations and other fine music retailers across Canada on June 2nd.

Justine Hines does tremendous work for Variety-The Children’s Charity, Walmart - Walk for Miracles and he operates the Justine Hines Foundation, helping all kinds of organizations that choose to emphasis abilities - not disabilities.

I first met Justine on the Easter Seals tele-thon and then in 2008 he graciously appeared as our guest judge/performer at Ontario Track3 Craigleith Idol.

You can check out his new release of Say What You Will and send a very cool video email to a friend by following this link http://swyw.inmusic.ca/ Justin's success as an artist and performer also influence his success as a philanthropist.

When he's rising to the top, he lifts up thousands of people with him. Spread the word - This guy is good!

Steve Jones
Past President
Ontario Track3 for Disabled Children

President
Business Services - Design Group Staffing

Canadian April Employment Data

Friday May 8, 2009

Monthly employment data is a lagging indicator that confirms what really happened in the two to three months preceding. Nevertheless, the markets and the media react to this information as if the Colonel had just unveiled his secret formula of 11 different spices.

Today's information was an exception to the rule. Job creation? Who would have imagined that 36,000 jobs were created in April 2009? Did that really happen? Nevertheless, the April overall unemployment rate remained unchanged at 8% because more people entered the job market to offset these new job gains.

Quebec lead the way with new jobs. It's not hard to imagine why Quebec is out pacing Ontario when you compare the Quebec dynamic leadership of Minister David WHISSELL (PQ, Minister of Labour) and Minister Sam Hamad (PQ, Minister of Employment and Social Solidarity) to the over interfering and regulation loving controversial Minister Peter Fonseca (ON, Minister of Labour) and over taxing Premier McGuinty. I'm certain that Ontarians will eventually succeed in spite of their government.

The temporary staffing services industry is a leading indicator of the economy. The industry began reporting a reduction in their hours as far back as April 2008, a full six months ahead of the dramatic declines in the stock markets and employment data.

This new April data may be a sign that we have found the bottom but it does not mean that we on the road to recovery just yet. Managers won’t jump to rehire permanent employees until the fog has lifted and there is visibility down the road of recovery. The first jobs to emerge will be temporary and contract. The staffing services industry will provide just-in-time skilled resources to meet staffing needs while helping businesses hedge against the uncertainties ahead.

If you know people who are unemployed, then encourage them to consider temp and contract work. Between 45% and 65% of the people who start working temporary will eventually convert to full time. Flexibility, adaptability, a positive outlook and a willingness to seize opportunity - these are just four spices in the Colonel's formula for future prosperity.

BTW - Suhana Meharchand of CBC News Today is absolutely charming. Watch the video and see for yourself.

Steve Jones

President

The People Bank, Design Group Staffing Inc.