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 December 31, 1997

                                       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 February 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>
                                                            December 31,   September 30,
         ASSETS                                                 1997           1997
         ------                                             ------------   -------------
                                                            (Unaudited)
CURRENT ASSETS:
<S>                                                         <C>           <C>        
    Cash                                                    $   140,000   $   139,000
     Accounts receivable, less allowance
           for doubtful accounts of $231,000 and $200,000
           for December 31 and September 30, respectively     6,815,000     6,820,000
     Prepaid expenses and other current assets                  541,000       146,000
                                                            -----------   -----------
                Total Current Assets                          7,496,000     7,105,000
PROPERTY AND EQUIPMENT, NET OF
ACCUMULATED DEPRECIATION                                      3,715,000     3,633,000

GOODWILL AND OTHER ASSETS                                       102,000       105,000
                                                            -----------   -----------
                                                            $11,313,000   $10,843,000
                                                            ===========   ===========


LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
    Loans payable to bank                                   $ 2,200,000   $ 1,295,000
    Accounts payable and accrued expenses                     1,484,000     1,472,000
    Accrued payroll and related taxes                           841,000     1,291,000
    Income taxes                                                     --       168,000
    Current portion of long term debt                            25,000        25,000
                                                            -----------   -----------
                    Total Current Liabilities                 4,550,000     4,251,000
LONG TERM DEBT                                                  400,000       406,000
                                                            -----------   -----------

                     Total Liabilities                        4,950,000     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                                       3,056,000     2,879,000
                                                            -----------   -----------
                                                              6,752,000     6,575,000
      LESS:  Cost of 146,000 shares of common
               stock held in treasury                           389,000       389,000
                                                            -----------   -----------
                  Total Stockholders' Equity                  6,363,000     6,186,000
                                                            -----------   -----------
                                                            $11,313,000   $10,843,000
                                                            ===========   ===========
</TABLE>


     See accompanying notes to consolidated financial statements.


                                       2
<PAGE>

                           Joule Inc. And Subsidiaries
                        Consolidated Statements of Income

                                                        Three Months Ended
                                                   December 31,    December 31,
                                                       1997           1996
                                                   ------------    ------------
                                                   (Unaudited)     (Unaudited)

REVENUES                                           $ 12,304,000   $ 10,943,000
                                                   ------------   ------------

COSTS, EXPENSES AND OTHER:
      Cost of services                               10,035,000      9,087,000
      Selling, general & administrative expenses      1,921,000      1,638,000
      Interest expense                                   52,000         62,000
      Other                                                --           (1,000)
                                                   ------------   ------------

INCOME BEFORE INCOME TAX PROVISION                      296,000        157,000

INCOME TAX PROVISION                                    118,000         63,000
                                                   ------------   ------------

NET INCOME                                         $    178,000   $     94,000
                                                   ============   ============

BASIC AND DILUTED EARNINGS PER SHARE               $       0.05   $       0.03
                                                   ============   ============

AVERAGE COMMON SHARES OUTSTANDING                     3,670,000      3,661,000
                                                   ============   ============

AVERAGE COMMON SHARES AND COMMON
      EQUIVALENTS OUTSTANDING                         3,673,000      3,663,000
                                                   ============   ============

     See accompanying notes to consolidated financial statements.



                                       3
<PAGE>

     
                           Joule Inc. And Subsidiaries
                      Consolidated Statements of Cash Flows
 
<TABLE>
<CAPTION>
                                                                             Three Months Ended
                                                                       December 31,    December 31,
                                                                           1997            1996
                                                                       ------------    ------------
                                                                        (Unaudited)     (Unaudited)
<S>                                                                     <C>            <C>        
CASH FLOWS FROM OPERATING ACTIVITIES:
       Net Income                                                       $   178,000    $    94,000
  Adjustments to reconcile net income to
     net cash flows provided by (used in) operating
     activities:
        Depreciation and amortization                                       122,000        118,000
        Provision for losses on accounts receivable                          31,000         18,000
        Changes in operating assets and liabilities:
         Accounts receivable                                                (26,000)     1,107,000
         Prepaid expenses and other assets                                 (400,000)        26,000
         Accounts payable and accrued expenses                               12,000       (606,000)
         Accrued payroll and related taxes                                 (450,000)      (557,000)
         Income taxes                                                      (168,000)        12,000
                                                                        -----------    -----------
            Net cash flows provided by (used in) operating activities      (701,000)       212,000
                                                                        -----------    -----------

CASH FLOWS FROM INVESTING ACTIVITIES:
  Acquisitions of property and equipment                                   (197,000)       (46,000)
                                                                        -----------    -----------
       Net cash flows used in investing activities                         (197,000)       (46,000)
                                                                        -----------    -----------

CASH FLOWS FROM FINANCING ACTIVITIES:
  Increase (decrease) in loans payable to bank                              905,000        (45,000)
  Payment of long term debt                                                  (6,000)        (6,000)
                                                                        -----------    -----------
       Net cash flows provided by (used in) financing activities            899,000        (51,000)
                                                                        -----------    -----------

NET CHANGE IN CASH                                                            1,000        115,000

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

CASH, END OF PERIOD                                                     $   140,000    $   290,000
                                                                        ===========    ===========

SUPPLEMENTAL CASH FLOW INFORMATION:

          Interest paid                                                 $    48,000    $    62,000
                                                                        ===========    ===========

          Income taxes paid                                             $   335,000    $    53,000
                                                                        ===========    ===========
</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.



                                       5
<PAGE>



                                                        10

                           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. Revenues increased approximately 12% to $12.3
million during the first three months of fiscal 1998 from $10.9 million for the
year earlier period. Commercial staffing revenue increased 10% to $4.4 million
in 1998 from $4.0 million in 1997. Technical staffing revenue was $3.6 million
in 1998, a 29% increase over 1997 revenue of $2.8 million. Industrial revenue
increased to $4.3 million in 1998 from $4.2 million in 1997, a 2% increase. Cost
of services improved to 81.6% of revenue in the 1998 first quarter compared to
83.0% for the 1997 first quarter. 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 were $1.9 million, or 15.6% of
revenues for the 1998 period compared to $1.6 million, or 15.0% of revenues for
the 1997 period. 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. The current period
increase was principally due to higher staff employee related expenses
necessitated by current market conditions.

     Interest expense was $52,000 for the 1998 quarter, a 16.1% decrease from
1997, reflecting a decrease in average borrowings. The effective tax rate
approximated 40% in both periods. As a result of the above, net income increased
to $178,000 or $0.05 per share, basic and diluted, in 1998 compared with net
income of $94,000 or $0.03 per share, basic and diluted, for the 1997 period.


                                       6
<PAGE>


                           JOULE INC. AND SUBSIDIARIES

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


Liquidity and Capital Resources

Current assets at December 31, 1997 were $7,496,000 as compared to $7,105,000 at
September 30, 1997 and current liabilities were $4,550,000 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; $2,200,000 was outstanding under this line as of
December 31, 1997.

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 4. Submission of Matters to a Vote of Security Holders

(a)  The Annual Meeting of Stockholders was held on February 4, 1998.

(b)  The following directors were elected at the annual meeting with the votes
     as indicated:

                                            VOTES FOR        VOTES WITHHELD
                                            ---------        --------------
       Richard Barnitt                      3,630,559             1,120
       Paul DeBacco                         3,630,559             1,120
       Robert W. Howard                     3,630,559             1,120
       Emanuel N. Logothetis                3,630,559             1,120
       Nick M. Logothetis                   3,630,559             1,120
       Steven Logothetis                    3,630,559             1,120

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)

February 11, 1998                        /s/ E. N. Logothetis, Chairman
                                        -------------------------------------
                                        E. N. Logothetis, Chairman
                                        (Principal Executive Officer)


February 11, 1998
                                         /s/ Bernard G. Clarkin
                                        --------------------------------------
                                        Bernard G. Clarkin, Vice President and
                                        Chief Financial Officer
                                        (Principal Financial Officer)