(Editor’s Note: This is the next in a series of guest blog posts about contract staffing, courtesy of Top Echelon Contracting, the recruiter’s back-office solution.  Similar posts will appear in future issues of The Pinnacle Newsletter Blog.)

One of the questions we get most often from recruiters looking to get into contract staffing is “What are the top industries for contract staffing?”

That’s why we analyze the contract placements that come through our back-office each year.

According to our 2012 placement statistics, the top seven sectors for contract staffing nationwide were as follows:

• Healthcare—29%
• Business Professionals and Support Staff—25%
• Engineering and Manufacturing—16%
• Information Technology—11%
• Finance and Accounting—10%
• HR/Legal/Recruiting—7%
• Sales/Marketing—2%

Healthcare has been a leading industry for contract staffing for years and is only getting stronger as the population continues to age.  Healthcare contractors will likely be even more in demand when the Obamacare “individual mandate” begins requiring individuals to get healthcare coverage, which will send more consumers to already overtaxed healthcare providers.

Last year, we at Top Echelon Contracting increased our focus on helping recruiters make healthcare contract placements.  We ran a number of Physical Therapists, Occupational Therapists, Speech Language Pathologists, Pharmacists, Pharmacy Techs, and Registered Nurses (RNs) through our back-office in 2012.  That trend has continued into 2013.

We also expanded our Workers’ Comp coverage in 2012 to allow more Engineering and Manufacturing placements in a wider range of environments.  This was our third-largest sector in 2012.

We saw the largest jump in the placement of Business Professionals and Support Staff, which increased 9% over 2011.  Business Professionals and Support Staff were placed in a variety of industries and business sectors.

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(Editor’s Note: This is the next in a series of guest blog posts about contract staffing, courtesy of Top Echelon Contracting, the recruiter’s back-office solution.  Similar posts will appear in future issues of The Pinnacle Newsletter Blog.)

As job creation in the professional arena continues to drive the economic recovery, the Business Professional and Support Staff sector is becoming one of the hottest areas for contract staffing.

According to Top Echelon Contracting’s 2012 statistics, Business Professional and Support Staff contractors accounted for 25% of our contract placements, compared with 16% in 2011. The only sector to bring in more contractors last year was Healthcare.

This is no surprise.  While jobs lost in the recession were manual manufacturing and construction positions, employment experts have noted that job creation in the recovery is coming from the professional sector.  The unemployment numbers bear this out.  The unemployment rate for degreed, white-collar professionals has remained under 4% even as the overall rate has struggled to get just below the 8% mark.

A recent CNNMoney.com article confirms that workers with the highest levels of education are enjoying the fastest employment gains during the recovery.

“Relative demand for highly educated workers is increasing,” Brookings Institution Senior Research Associate Jonathan Rothwell told CNNMoney.com.  “There’s a long-run shift in the economy toward more professional occupations, and it’s mostly at the expense of blue-collar occupations.”

TEC’s statistics also indicate a change in attitude toward contract staffing among both professional candidates and companies.  Contractors used to be thought of mainly as “temps” working very short-term assignments in clerical and blue-collar positions.

Now companies are utilizing contractors for more long-term (six- to nine-month average) assignments in positions all the way up to the C-suite.  One trend that has come out of this is executive temping, where companies utilize contractors to serve as interim executives to complete executive-level projects or to serve as consultants.

As employers continue to find more ways to cut costs in this roller coaster economy and workers look for increased flexibility, we can only expect this trend to continue.

— — —

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Every year, Top Echelon® Contracting tracks the largest contract placements made through our back-office.  This year, we are happy to report that our largest placement in 2012 was a split placement between two Preferred Members of Top Echelon Network.

The placement occurred between job order recruiter Jim Brown of Galileo Search and candidate recruiter Jim Strickland of BioSource International.  They placed an Interim Patient Safety Officer at a 250+ bed acute care facility.

The placement lasted nine months, and each recruiter earned $24,782.26 over the course of the assignment.

This just goes to show that there is money to be made in contract staffing. As employers continue to look for ways to contain costs in the face of additional employment regulations and continued economic uncertainty, the opportunities to increase your income through contract staffing are only going to grow.

And like Brown and Strickland, you can leverage the power of your Trading Partners to take advantage of those opportunities.

For more information on how to add contract staffing to your business model, please contact a Contract Staffing Administrator at (888) 627-3678.

— — —

888.627.3678
DFledderjohann@TopEchelonContracting.com
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(Editor’s Note: This is the next in a series of guest blog posts about contract staffing, courtesy of Top Echelon Contracting, the recruiter’s back-office solution.  Similar posts will appear in future issues of The Pinnacle Newsletter Blog.)

While employers across the nation are grumbling about healthcare reform, you may just end up rejoicing if you are working the healthcare niche.

A recent Staffing Industry Analysts report predicts that the Patient Protection and Affordable Care Act (PPACA), better known as “Obamacare,” will increase the demand for healthcare professionals.  The influx of millions of customers who will be forced under the PPACA to get healthcare insurance, along with the aging population and a limited talent pool, is expected to bring a “perfect storm” labor shortage in the healthcare industry.

The report states that there are already skills shortages for some healthcare occupations, including some therapy professions.  For those occupations, the unemployment rate was below 1% during 2011, a year when the American unemployment rate hovered over 8%.

Staffing Industry Analysts’ 2013 Staffing Occupational Markets Guidebook, which lists occupations that are poised for contract staffing growth, backs up the findings of the report.  Healthcare positions ranked high on the list. Specifically, the guidebook shows that physical therapists are in the top three and that contract/temporary payroll for these professionals is expected to increase by 39% this year.

Healthcare is a huge area for contract staffing because medical facilities need a flexible, cost-effective solution to their staffing challenges.  In fact, healthcare has been one of the top three industries for Top Echelon Contracting’s contract placements for over six years! In the past couple of years, we have especially noticed growth in the therapy fields (occupational, physical, and speech-language).

If you are considering a new niche, healthcare may be the way to go.  But if you do delve into this area, you will want to make sure your contract placements are handled properly. Failing to thoroughly screen and validate healthcare contractors could result in severe consequences for clients and you.

Top Echelon Contracting runs a series of additional steps on all of its healthcare contractors including: drug screenings, skills checklists, license verification, immunization verification, and more.  For more information on how we can help you with healthcare contract placements, please call a contract staffing administrator at (888) 627-3678.

— — —

888.627.3678
DFledderjohann@TopEchelonContracting.com
Connect with Debbie on LinkedIn.
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(Editor’s Note: This is the next in a series of guest blog posts about contract staffing, courtesy of Top Echelon Contracting, the recruiter’s back-office solution.  Similar posts will appear in future issues of The Pinnacle Newsletter Blog.)

Everyone who is anyone is offering their predictions for what the biggest trends in recruiting and hiring will be in 2013, so we figured we might as well throw our hat in the ring.  Based on what we have read and discussions we’ve had with recruiters over the past year, here are our predictions for 2013:

1. Employers will remain cautious about hiring.  Although the “fiscal cliff” has been resolved, there is still a lot of economic uncertainty out there that is reining hiring in. CNNMoney.com has reported that there are still more “fiscal cliffs” to watch out for as Congress continues its partisan ways, and consumer confidence is down.  And while some experts predict that hiring will be up, most agree that the growth won’t be as strong as it could be.
2. Obamacare will have a major impact on hiring. Perhaps one of the biggest economic question marks is the Patient Protection and Affordable Care Act (PPACA), better known as Obamacare.  There is a lot of uncertainty among employers regarding how to comply – or if they even should. We are hearing that this is already causing an impact on hiring. Since employers with less than 50 employees don’t have to comply, those near that threshold are simply choosing not to hire so they can avoid it all together. Others are considering reducing employees’ hours to lower their costs under the law.  As a recruiter, you will want to be sure to know the basics of the law and be able to help come up with creative ways to help your clients keep their costs down while still getting the work done.
3. More workers will join “Gig Economy.”  As we discussed in a previous blog post, there is a growing trend toward a  “gig economy” where workers shun full-time traditional employment and instead work on a contract basis jumping from project to project.  This is driven by a number of factors, including the need for more work-life balance and workers’ distrust of employers born out of the layoffs of the recession. The emergence of technology, such as mobile phones and the Internet, has also allowed workers to work more remotely, which fits in well with the project-based work.
4. Record-breaking contract staffing growth. Based on these first three trends, it’s no surprise that the Bureau of Labor Statistics (BLS) is expecting contract staffing to reach a record high by the summer of 2013. Contract staffing provides a risk-free way for companies to remain productive without committing to a direct hire or taking on the benefits costs that come with them.
5. Debates about skills shortages will continue. Is there a skills shortage? It depends on who you ask. Some say the skills shortage will be a major challenge, especially in the manufacturing and IT sectors. Others say the impact has been overestimated (see USAToday article “Study says shortage of skilled workers not that severe”).  And still others, most notably Peter Cappelli of the Wharton School, claim that the real problem is employers that are too picky and not willing to train.  Whether or not the so-called skills shortages have a real impact on hiring and recruiting in 2013 remains to be seen, but we are willing to bet that the discussion is far from over.

Please feel free to provide some of your own predictions in our comments section!

— — —

888.627.3678
DFledderjohann@TopEchelonContracting.com
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(Editor’s Note: This is the next in a series of guest blog posts about contract staffing, courtesy of Top Echelon Contracting, the recruiter’s back-office solution.  Similar posts will appear in future issues of The Pinnacle Newsletter Blog.)

We’ve noticed over the past several months a new buzz phrase gaining steam: “the gig economy.” So just what is the gig economy, and how does it affect you as a recruiter?

We first encountered the phrase back in August when Huffington Post printed an excerpt of Richard Greenwald’s book Labor Rising, The Past and Future of Working People in America.

According to Greenwald, “gig economy” refers to a trend that has emerged over the past few years where workers “jump from job to job, career to career, project to project working as consultants.” In the excerpt, he refers to the gig economy as “the most fundamental economic shift of the past 50 years” and compares it to the 1950’s when a large portion of the American workforce shifted from blue collar to white collar work.

Now the phrase “gig economy” has popped up again in a report from Marketplace, a public radio program that focuses on business and the economy. According to Marketplace, a third of the American workforce is working a non-traditional or contract positions.  As a result, “the idea of working nine-to-five for 40 years is going the way of the pension and the gold watch.”
Freelancers Union CEO Sara Horowitz told Marketplace that the gig economy represents a major shift in the labor market.  In the past, freelance and contract work were only used in professions such as media and graphic design, but now Horowitz says the gig economy has touched every profession.

The struggling economy has been a major driver of this trend, economist Ken Goldstein told Marketplace.

“It not only relieves them of having to pay for the whole benefit package, but also, if things indeed worsen, they can let these people go because there’s no commitment to keeping these people,” Goldstein said.

In other words, client companies need cost savings and workforce flexibility, especially as they face healthcare reform and uncertainty in Washington. What this means for recruiters is that more and more clients may be wanting to fill open positions with contractors rather than direct hires. If you are not offering contract staffing, they may go to your competitors to fill those positions.

— — —

888.627.3678
DFledderjohann@TopEchelonContracting.com
Connect with Debbie on LinkedIn.
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(Editor’s Note: This is the next in a series of guest blog posts about contract staffing, courtesy of Top Echelon Contracting, the recruiter’s back-office solution.  Similar posts will appear in future issues of The Pinnacle Newsletter Blog.)

The American economy is teetering on the edge of the “Fiscal Cliff,” but that doesn’t mean your job orders have to go over with it.

If Congress can’t come to an agreement by December 31, across-the-board tax increases and government funding cuts will automatically go into effect.  Many experts are predicting that if something isn’t done by December 31, the United States could go into another recession.  With that threat looming, many employers are taking a wait-and-see-approach to hiring.

According to a recent Staffing Stream article, “Reducing Fear of the Fiscal Cliff,” it’s not that employers don’t want to hire.  In fact, 58% of executives surveyed by Korn/Ferry International say they intend to increase hiring in the next 12 months.  However, they are not going to start that hiring until the future is more certain.

That is obviously bad news for recruiters who depend on direct hiring for their livelihoods.  But there is some good news. The Staffing Stream article suggests that contingent staffing may see a boost as a result of this situation.  The article predicts that temporary/contract staffing in 2013 will be especially strong for information technology, marketing, and engineering.  After all, regardless of their fears of the future, employers need to have enough staff to handle today’s business demands.

Contract staffing allows them to get the help they need now without the commitment of a direct hire.  Rather than having to conduct mass layoffs if the economy does indeed go over the cliff, they will be able to simply end the workers’ contract assignments.  Plus, they won’t have the burden of unemployment, Workers’ Compensation, or benefits.

So if you have clients who need to hire, but are reluctant to do so due to the economic uncertainty, you may want to suggest that they bring in contractors.  And don’t worry if you have never placed contractors.

All you need is a good contract staffing back-office, such as Top Echelon Contracting, to become the legal W-2 Employer of Record for your contractors.  By partnering with a contracting back-office, all you have to worry about is recruiting.  The back-office will handle all of the legal, financial, and administrative details.

What will happen with the economy in 2013 is anyone’s guess.  But by adding contract staffing to your business model, you can be ready for whatever comes along.

— — —

888.627.3678
DFledderjohann@TopEchelonContracting.com
Connect with Debbie on LinkedIn.
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(Editor’s Note: This is the next in a series of guest blog posts about contract staffing, courtesy of Top Echelon Contracting, the recruiter’s back-office solution.  Similar posts will appear in future issues of The Pinnacle Newsletter Blog.)

You think you’ve found the perfect candidate for your client’s tough job order.  He passed the phone interview and the following three in-person interviews with flying colors.  He aced all of the skills and assessment tests.  He has all of the qualifications and seems to be a perfect cultural fit.

But while your client deliberates over whether this is really the BEST they can do, your candidate takes another job.

A slow hiring process wears candidates down and ultimately costs you time and money as you start the search process over and over again.  Dragging out a search can also deter candidates before they even apply.  According to www.ere.net citing a Randstad survey, candidates start to think there is something wrong with a job posting if it remains unfilled after 72 days.

Mark Bull, the UK CEO of Randstad, told ERE that the best applicants can often be found early in the process and that employers should have the courage to act quickly.

“If they don’t, they have to be prepared to see that job seeker walk into the arms of a competitor who is willing to move faster,” he said.

You can help make that decision easier for your client by offering to provide that candidate on a contract-to-direct basis. This gives the client the opportunity to “try-before-they-buy” risk-free.  And in the meantime, you prevent losing a quality candidate . . . and the placement fee.

— — —

888.627.3678
dfledderjohann@topecheloncontracting.com
Connect with Debbie on LinkedIn.
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(Editor’s Note: This is the next in a series of guest blog posts about contract staffing, courtesty of Top Echelon Contracting, the recruiter’s back-office solution.  Similar posts will appear in future issues of The Pinnacle Newsletter Blog.)

Demand for temporary/contract workers in the professional sector is expected to exceed previous records in 2012 and 2013, according to Staffing Industry Analysts’ U.S. Staffing Industry Forecast.

Specifically, the IT Staffing and Engineering/Design industry segments within the Professional/Specialty sector are expected to beat previous records for staffing revenue.  IT Staffing’s revenue previously peaked in 2000.

This year, the industry is expected to generate 107% of 2000’s revenue by the end of this year and 116% in 2013.  In 2012, Engineering/Design is expected to bring in 106% of the revenue from its previous peak year of 2008 and 111% in 2013.

Meanwhile, the usage of “temps” in the office/clerical industry appears to be declining. It is projected that in 2012, the industry will only hit 85% of its previous 2006 peak and only 89% in 2013.

This correlates with what Top Echelon® Contracting has been experiencing.  Engineering and IT have landed in our top three industries for contract placements for the past several years, and we are expecting the same for 2012.  We have particularly seen an increase in the engineering/manufacturing sector and have begun accepting more placements in this area.

So what does this mean to you as a recruiter?  Well first of all, if you are looking for a niche in which to offer contract staffing services, it’s pretty clear that IT and Engineering are good places to start and have longevity.

— — —

888.627.3678
dfledderjohann@topecheloncontracting.com
Connect with Debbie on LinkedIn.
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(Editor’s Note: This is the next in a series of guest blog posts about contract staffing, courtesy of Top Echelon Contracting, the recruiter’s back-office solution.  Similar posts will appear in future issues of The Pinnacle Newsletter Blog.)

How important is workplace flexibility to working adults? It’s important enough that 45% would sacrifice a portion of their salary to get it, according to a Staffing Industry Analysts article citing a Moms Corps survey.

They are also willing to give up increasingly large percentages of their salaries to get that flexibility. This year, they said they would be willing to take an 8.6% pay cut. Last year they said they would only be willing to slash their pay by 5.8%.

In addition, the survey found that:

• 67% believe they can “have it all” when it comes to work-life balance.
• 53% said they could get more done if they could occasionally work from home.
• 60% said that the economy has no impact on their desire for workplace flexibility.

This growing need for workplace flexibility is one of the major reasons more workers are choosing to become contractors. Contract staffing can help workers gain flexibility by allowing them to:

1. Work hours that are convenient for them.  Contract assignments are often project based, so companies may allow flexible daily or weekly work schedules, as long as the work gets done on a timely basis.
2. Not be tied to an office.  If a candidate has what they need at home, they can often work between their home and office. Smartphones, the Internet, and other technological advances are making this more and more feasible
3. Take control of their free time.  New employees typically only get one week of vacation, two tops. Even if they are willing to take the time unpaid, they often are not allowed. With contracting, if they want to take an extended vacation or take the summer off to be with their children, they simply don’t take an assignment during that time. Many contractors choose to take assignments in other states to take advantage of the opportunity to travel. They actually look at this as a vacation of sorts in which they can explore new areas, cultures, etc.

Do your candidates need or want more flexibility in their work? If so, you way want to suggest contract staffing as an option. By providing a way for them to achieve work-life balance, you can make yourself the recruiter of choice for top candidates in your niche.

— — —

888.627.3678
dfledderjohann@topecheloncontracting.com
Connect with Debbie on LinkedIn.
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