Remember, you aren’t supposed to read too much into the jobs report
June 2012: “Therefore, it is important not to read too much into any one monthly report and it is informative to consider each report in the context of other data that are becoming available.†(LINK: http://www.whitehouse.gov/blog/2012/07/06/employment-situation-june)
They’ve been saying the same thing for years, month after month. But, unlike most times, the hiring of temporary workers isn’t a sign that things are getting better, despite some early spin from USA Today
A bright spot appeared to peek through Friday’s disappointing jobs report: The number of temporary workers rose by 25,000, making up nearly a third of the total 80,000 payroll gains in June.
Hooray, we’re saved!!!!!!!….oh, wait
The hiring of temporary employees traditionally augurs the addition of permanent staff. As employers grow more confident about their own needs and the economy, they convert contingent workers to staffers after several months, or bring on other employees.
While that’s still the case, staffing firms and company executives say temporary employees are keeping that status longer, in part due to nervousness about the unsettled economy. Also, many businesses are using contractors and other temp workers on an ongoing basis to better meet fluctuating demand and enlist workers with specialized skills for short-term projects. Firms also can save on benefits costs.
They keep trying to spin this as good news, then contradicting themselves. Because they aren’t converting those workers. They are worried about Obama’s unsettled economy. And benefits (cough Obamacare cough).
Partly as a result, the addition of contingent workers the past two years hasn’t consistently led to stronger permanent job growth. The number of temp workers placed by staffing firms is up 20% since June 2010, while total payrolls are up just 2.3%.
Manpower CEO Jeff Joerres says about 30% of the temporary employees his staffing firm has placed this year have been converted to permanent vs. 45% last year. “They’re loath to hire because they’ve been burned too many times” in a halting recovery, he says.
Don’t read too much into one month’s jobs report that highlights consistently poor data for the last two years.
