FORM 10-Q
                       SECURITIES AND EXCHANGE COMMISSION

                              WASHINGTON, DC 20549

(Mark One)

(X)  QUARTERLY  REPORT  PURSUANT  TO SECTION 13 OR 15(d) OF THE  SECURITIES  AND
     EXCHANGE ACT OF 1934

                  For the quarterly period ended March 31, 1998

                                       or

( )  TRANSITION  REPORT  PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES AND
     EXCHANGE ACT OF 1934

      For the transition period from_________________ to _________________

                          Commission File Number 1-9477

                                   Joule Inc.
             (Exact name of registrant as specified in its charter)

            Delaware                                      22-2735672
(State or other jurisdiction of                (IRS Employer Identification No.)
incorporation or organization)

                  1245 Route 1 South, Edison, New Jersey 08837
              (Address of principal executive officers) (Zip Code)

                                 (732) 548-5444
              ( Registrant=s telephone number including area code)

Indicate by check mark  whether the  Registrant  (1) has filed all reports to be
filed by Section 13 or 15 (d) of the Securities  Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the Registrant was required
to file such reports),  and (2) has been subject to such filing requirements for
the past 90 days.

Yes    _X_         No ___

As of May 6,  1998,  3,670,000  shares of the  Registrant's  common  stock  were
outstanding.





<PAGE>

Part I - Financial Information
Item 1. Financial Statements

                           Joule Inc. And Subsidiaries
                           Consolidated Balance Sheets

<TABLE>
<CAPTION>
                                                             March 31,    September 30,
         ASSETS                                                1998          1997
                                                            -----------   -----------
                                                            (Unaudited)
<S>                                                         <C>           <C>        
CURRENT ASSETS:
    Cash                                                    $   141,000   $   139,000
     Accounts receivable, less allowance
           for doubtful accounts of $258,000 and $200,000
           for March 31 and September 30, respectively        7,794,000     6,820,000
     Prepaid expenses and other current assets                  468,000       146,000
                                                            -----------   -----------
                Total Current Assets                          8,403,000     7,105,000
PROPERTY AND EQUIPMENT, NET OF
ACCUMULATED DEPRECIATION                                      3,728,000     3,633,000

GOODWILL AND OTHER ASSETS                                        94,000       105,000
                                                            -----------   -----------
                                                            $12,225,000   $10,843,000
                                                            ===========   ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
    Loans payable to bank                                   $ 2,350,000   $ 1,295,000
    Accounts payable and accrued expenses                     1,392,000     1,472,000
    Accrued payroll and related taxes                         1,359,000     1,291,000
    Income taxes                                                131,000       168,000
    Current portion of long term debt                            25,000        25,000
                                                            -----------   -----------
                    Total Current Liabilities                 5,257,000     4,251,000
LONG TERM DEBT                                                  394,000       406,000
                                                            -----------   -----------

                     Total Liabilities                        5,651,000     4,657,000
                                                            -----------   -----------
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY:
     Preferred stock, $.01 par value:
           Authorized 500,000 shares, none outstanding             --            --
     Common stock, $.01 par value:
           Authorized 10,000,000 shares-issued 3,816,000
                  shares                                         38,000        38,000
      Additional paid-in capital                              3,658,000     3,658,000
      Retained earnings                                       3,267,000     2,879,000
                                                            -----------   -----------
                                                              6,963,000     6,575,000
      LESS:  Cost of 146,000 shares of common
                stock held in treasury                          389,000       389,000
                                                            -----------   -----------
                   Total Stockholders' Equity                 6,574,000     6,186,000
                                                            -----------   -----------
                                                            $12,225,000   $10,843,000
                                                            ===========   ===========
</TABLE>


See accompanying notes to consolidated financial statements.


                                        2
<PAGE>

                           Joule Inc. And Subsidiaries
                        Consolidated Statements of Income

<TABLE>
<CAPTION>
                                                       Three Months Ended               Six Months Ended
                                                     March 31,      March 31,       March 31,      March 31,
                                                       1998           1997            1998           1997
                                                   ------------   ------------    ------------   ------------
                                                    (Unaudited)    (Unaudited)     (Unaudited)    (Unaudited)
<S>                                                <C>            <C>             <C>            <C>         
REVENUES                                           $ 13,646,000   $ 12,471,000    $ 25,950,000   $ 23,414,000
                                                   ------------   ------------    ------------   ------------

COSTS, EXPENSES AND OTHER:

      Cost of services                               11,223,000     10,113,000      21,258,000     19,200,000
      Selling, general & administrative expenses      2,001,000      1,796,000       3,922,000      3,434,000
      Interest expense                                   59,000         52,000         111,000        114,000
      Other                                              13,000        (19,000)         13,000        (20,000)
                                                   ------------   ------------    ------------   ------------
INCOME BEFORE INCOME TAX PROVISION                      350,000        529,000         646,000        686,000
INCOME TAX PROVISION                                    140,000        211,000         258,000        274,000
                                                   ------------   ------------    ------------   ------------
NET INCOME                                         $    210,000   $    318,000    $    388,000   $    412,000
                                                   ============   ============    ============   ============
BASIC AND DILUTED EARNINGS PER SHARE               $       0.06   $       0.09    $       0.11   $       0.11
                                                   ============   ============    ============   ============
AVERAGE COMMON SHARES OUTSTANDING - BASIC             3,670,000      3,661,000       3,670,000      3,661,000
                                                   ============   ============    ============   ============
AVERAGE COMMON SHARES AND COMMON
      EQUIVALENTS OUTSTANDING - DILUTED               3,673,000      3,663,000       3,673,000      3,663,000
                                                   ============   ============    ============   ============
</TABLE>


See accompanying notes to consolidated financial statements.




                                        3
<PAGE>

                           Joule Inc. And Subsidiaries
                      Consolidated Statements of Cash Flows
<TABLE>
<CAPTION>
                                                                                 Six Months Ended
                                                                              March 31,     March 31,
                                                                                1998          1997
                                                                            -----------    -----------
                                                                            (Unaudited)    (Unaudited)
<S>                                                                         <C>            <C>        
CASH FLOWS FROM OPERATING ACTIVITIES:
      Net Income                                                            $   388,000    $   412,000
      Adjustments to reconcile net income to
         net cash flows provided by (used in) operating
         activities:
            Depreciation and amortization                                       246,000        223,000
            Provision for losses on accounts receivable                          58,000         44,000
            Changes in operating assets and liabilities:
             Accounts receivable                                             (1,032,000)      (163,000)
             Prepaid expenses and other assets                                 (325,000)       154,000
             Accounts payable and accrued expenses                              (81,000)      (473,000)
             Accrued payroll and related taxes                                   68,000         47,000
             Income taxes                                                       (37,000)        29,000
                                                                            -----------    -----------
                Net cash flows provided by (used in) operating activities      (715,000)       273,000
                                                                            -----------    -----------

CASH FLOWS FROM INVESTING ACTIVITIES:

          Acquisitions of property and equipment                               (326,000)      (114,000)
                                                                            -----------    -----------
               Net cash flows used in investing activities                     (326,000)      (114,000)
                                                                            -----------    -----------

CASH FLOWS FROM FINANCING ACTIVITIES:
          Increase (decrease) in loans payable to bank                        1,055,000       (193,000)
          Payment of long term debt                                             (12,000)       (12,000)
                                                                            -----------    -----------
               Net cash flows provided by (used in) financing activities      1,043,000       (205,000)
                                                                            -----------    -----------

NET CHANGE IN CASH                                                                2,000        (46,000)

CASH, BEGINNING OF PERIOD                                                       139,000        175,000
                                                                            -----------    -----------

CASH, END OF PERIOD                                                         $   141,000    $   129,000
                                                                            ===========    ===========

SUPPLEMENTAL CASH FLOW INFORMATION:

          Interest paid                                                     $   104,000    $   114,000
                                                                            ===========    ===========

          Income taxes paid                                                 $   338,000    $    80,000
                                                                            ===========    ===========
</TABLE>


See accompanying notes to consolidated financial statements.



                                        4


<PAGE>


                           JOULE INC. AND SUBSIDIARIES
                              NOTES TO CONSOLIDATED
                              FINANCIAL STATEMENTS
                                   (UNAUDITED)

(1) The  consolidated  balance sheet at the end of the preceding fiscal year has
been  derived  from the audited  consolidated  balance  sheet  contained  in the
Company's  Form  10-K and is  presented  for  comparative  purposes.  All  other
financial  statements are unaudited.  All unaudited  amounts are subject to year
end adjustments and audit, but the Company believes all adjustments,  consisting
only of normal  and  recurring  adjustments,  necessary  to  present  fairly the
financial  position,  results of  operations  and  changes in cash flows for all
interim periods presented, have been made. The results of operations for interim
periods are not  necessarily  indicative of the  operating  results for the full
year.

Footnote  disclosures  normally  included in  financial  statements  prepared in
accordance with generally  accepted  accounting  principals have been omitted in
accordance  with the  published  rules and  regulations  of the  Securities  and
Exchange Commission.  These consolidated  financial statements should be read in
conjunction  with the financial  statements  and notes  thereto  included in the
Company's Form 10-K and Annual Report to Stockholders for the most recent fiscal
year.

(2) During the first quarter ended  December 31, 1997,  the Company  adopted the
provisions of statement of Financial Accounting Standards No. 128, "Earnings per
share" (SFAS 128). The new standard  requires the  presentation of basic EPS and
diluted EPS.  Basic EPS is  calculated  by dividing  income  available to common
shareholders  by  the  weighted   average  number  of  shares  of  common  stock
outstanding  during the period.  Diluted EPS is  calculated  by dividing  income
available to common shareholders by the weighted average number of common shares
outstanding  adjusted to reflect  potentially  dilutive  securities.  Previously
reported EPS amounts have been restated under the new standard.





                                       5

<PAGE>



                           JOULE INC. AND SUBSIDIARIES

Item 2. Management's Discussion and Analysis of Financial
        Condition and Results of Operations

Results of Operations

     The Company's  revenues are derived from providing staffing services to its
customers.   Such  services  include  providing  commercial  (office  and  light
industrial)  workers,   technical   (engineering,   scientific  and  information
technology)  personnel,  and  industrial  (skilled  craft  industrial  plant and
facility  maintenance)  labor. Over 90% of revenue in each period is billed on a
direct cost plus  markup  basis.  Revenue  increased  approximately  9% to $13.6
million for the three  months  ended  March 31, 1998 from $12.5  million for the
year earlier period. Revenue for the first six months of fiscal 1998 amounted to
$26.0 million,  an increase of 11% or $2.5 million over the comparable six month
period of 1997.  Commercial staffing revenue increased 7% to $4.7 million and 8%
to $9.1 million for the  respective  three and six month periods ended March 31,
1998. Technical staffing revenue was $3.9 million in the current 1998 quarter, a
26% increase over the 1997  quarterly  revenue of $3.1 million,  and rose 28% to
$7.6 million as compared to the 1997 six month  period.  Industrial  revenue for
the 1998 three and six month  periods was  slightly  higher than the  comparable
1997 periods. Cost of services amounted to 82.2% of revenue in the current three
months  compared to 81.0% in the same prior year period due to the completion of
marginal  fixed price  projects in the current period and startup costs incurred
to initiate an employee van transportation service. Cost of services amounted to
81.9% of revenue in both the  current  and prior year six month  periods.  These
expenses consist primarily of compensation to employees on assignment to clients
and related  costs,  including  social  security,  unemployment  taxes,  general
liability and workers' compensation insurance, and other costs of services.

     Selling,  general and administrative  expenses amounted to $2.0 million and
$3.9 million for the three and six months ended March 31, 1998  compared to $1.8
million and $3.4 million for the year earlier periods, and represented 14.7% and
15.1% of revenue in the 1998 periods, a slight increase over the comparable 1997
periods  of 14.4% and 14.7% of  revenue.  Selling,  general  and  administrative
expenses  principally  include  staff  employees'  salaries  and related  costs,
advertising,  professional fees,  depreciation,  provision for the allowance for
doubtful  accounts and other costs related to maintaining  the Company's  branch
offices.  These increases are  principally due to higher staff employee  related
expenses necessitated by current market conditions.

                                       6

<PAGE>


                           JOULE INC. AND SUBSIDIARIES

Item 2. Management's Discussion and Analysis of Financial
        Condition and Results of Operations (continued)


     Interest  expense  amounted to $59,000 and  $111,000 for the 1998 three and
six month periods compared to $52,000 and $114,000 for the respective prior year
periods, reflecting an increase in average borrowings in the 1998 second quarter
offset by a  decrease  in average  borrowings  in the 1998  first  quarter.  The
effective tax rate  approximated 40% for all periods  presented.  As a result of
the above,  net income for the 1998 six month  period was  $388,000 or $0.11 per
share,  basic and  diluted,  compared  with net income of  $412,000 or $0.11 per
share, basic and diluted,  for the 1997 period; for the 1998 three month period,
net income was  $210,000  or $0.06 per share,  basic and  diluted,  compared  to
$318,000 or $0.09 per share, basic and diluted.


Liquidity and Capital Resources

     Current assets at March 31, 1998 were  $8,403,000 as compared to $7,105,000
at September 30, 1997 and current  liabilities were $5,257,000 at March 31, 1998
compared to $4,251,000 as of September 30, 1997. Employees typically are paid on
a weekly basis.  Clients generally are billed on a weekly basis. The Company has
generally  utilized  bank  borrowings  to meet its working  capital  needs.  The
Company  has a  $4,500,000  bank line of credit;  loans  thereunder  are secured
principally  by  receivables  and bear  interest at the bank's prime rate with a
LIBOR plus two and one quarter percent option;  $2,350,000 was outstanding under
this line as of March 31, 1998.

     The  Company  believes  that  internally   generated  funds  and  available
borrowings will provide  sufficient cash flow to meet its  requirements  for the
next 12 months.



                                       7


<PAGE>

                           JOULE INC. AND SUBSIDIARIES
                           PART II - OTHER INFORMATION

Item 6.               Exhibits and Reports on Form 8-K

 (a)                  Exhibits: None
 (b)                  Reports on Form 8-K
                      No reports on Form 8-K have been filed  during the quarter
                      for which this report is filed.

                                   SIGNATURES

Pursuant to the  requirements  of the  Securities  and Exchange Act of 1934, the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned there unto duly authorized.

                                   JOULE INC.
                                  (Registrant)

May 12, 1998
                                           E.N. Logothetis
                                   ---------------------------------------------
                                    E. N. Logothetis, Chairman
                                   (Principal Executive Officer)


May 12, 1998
                                          Bernard G. Clarkin
                                   ---------------------------------------------
                                   Bernard G. Clarkin, Vice President and Chief
                                   Financial Officer
                                   (Principal Financial Officer)



                                       8