UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-K

   X    Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange
 -----  Act of 1934 for the fiscal year ended December 28, 1997.

        Transition  Report  Pursuant  to  Section 13 or 15(d) of the Securities
 -----  Exchange Act of  1934

Commission File Number:  0-26094

                           SOS STAFFING SERVICES, INC.
             (Exact name of Registrant as specified in its charter)

                Utah                                      87-0295503
    (State or other jurisdiction of                    (I.R.S. Employer
     incorporation or organization)                    Identification No.)

1415 South Main Street, Salt Lake City, Utah               84115
  (Address of principal executive offices)               (Zip Code)

       Registrant's telephone number, including area code: (801) 484-4400

               Securities registered pursuant to Section 12(b) of the Act:
                                            None

               Securities registered pursuant to Section 12(g) of the Act:

                                    Common stock, $0.01  par value
                                            (Title of class)

Indicate by check mark whether the Registrant (1) has filed all reports required
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 [ ]

Indicate by check mark if disclosure of delinquent  filers  pursuant to Item 405
of Regulation  S-K is not contained  herein,  and will not be contained,  to the
best  of  the  Registrant's   knowledge,  in  definitive  proxy  or  information
statements  incorporated  by  reference  in Part  III of this  Form  10-K or any
amendment to this Form 10-K. [ X ]

The  aggregate  market value of the Common Stock held by  non-affiliates  of the
Registrant,  on March 2, 1998,  based upon the closing sales price of the Common
Stock of $20.813 per share on that date, as reported on the NASDAQ Stock Market,
was approximately $188,920,600.  Shares of Common Stock held by each officer and
director and by each person who owns 5% or more of the outstanding  Common Stock
have been  excluded in that such  persons may be deemed to be  affiliates.  This
determination of affiliate status is not necessarily a conclusive  determination
for other purposes.

As of March 2, 1998,  Registrant  had  outstanding  12,660,162  shares of Common
Stock.

                       DOCUMENTS INCORPORATED BY REFERENCE
Portions of the  Registrant's  Annual Report to Shareholders for the fiscal year
ended  December 28, 1997 are  incorporated  by reference into Parts II and IV of
this  Report.  Portions  of the Proxy  Statement  for  Registrant's  1997 Annual
Meeting of Shareholders to be held May 13, 1998 are incorporated by reference in
Part III of this Report.



<PAGE>

                                     PART I

ITEM 1.  BUSINESS
         --------


General

         SOS  Staffing  Services,  Inc.  ("SOS" or the  "Company")  is a leading
provider of staffing  and  consulting  services  in the  western  states.  As of
December  28,  1997,  SOS  operated a network of 134  offices in 18 states.  The
Company provides a broad range of commercial staffing and information technology
("IT")  services.   Commercial   staffing  services  include  light  industrial,
clerical,  industrial,  technical, specialty and other professional services. IT
services  consist of  staffing,  consulting  and  outsourcing  services  such as
systems  design,  programming,  network  and  systems  management  and  business
consulting.  During the 52 weeks ended December 28, 1997,  the Company  provided
approximately   78,000  staffing  employees  to  more  than  10,000  businesses,
professional and service organizations and government agencies.

         Since  completing its initial public offering in July 1995, the Company
has aggressively pursued an acquisition program, having acquired 34 staffing and
consulting  companies  with 56 offices,  consisting  of 42  commercial  staffing
offices and 14 IT  staffing  and  consulting  offices.  Ten of the  acquisitions
completed  since July 1996 were of IT staffing and consulting  companies,  which
have allowed the Company to diversify the mix of staffing  services  provided to
include higher margin services.  On a pro forma basis, revenues from IT staffing
services  represented 22% of total revenues for the 1997 fiscal year compared to
5% of total  revenues  for the 52 weeks  ended  December  28.  1997.  Additional
acquisitions   have  added   other   specialty   services,   including   medical
administrative   support,    professional   mining,   geology,   hydrology   and
environmental services.


Business Strategy

         The Company's  goal is to enhance its  profitability  through a focused
business strategy.  The Company has identified the following key elements of its
strategy, which management believes are critical to the Company's success:

         Focus on Small to Mid-Size  Customers and Projects.  Historically,  the
Company's  customers  have consisted  primarily of small to mid-size  companies.
Sales to these  businesses  tend to generate higher margins than larger national
accounts. The Company believes that focusing on small to mid-sized customers and
smaller  projects limits its exposure to margin  pressure  associated with large
national contracts and volume discounts.  In the IT segment, the Company focuses
on  smaller  specialty  projects,  often at larger  businesses  or as support in
larger  projects.  The  Company  believes  that  it  has  developed  competitive
advantages in serving small and mid-sized  businesses  and projects by tailoring
its  operations to meet local customer  needs,  including the  establishment  of
strong customer  relationships through local marketing efforts,  quality service
and community involvement.

         Deliver Higher Margin Services.  The Company's  operating results since
1991 have been  significantly  enhanced by its strategy to deliver higher margin
services.  Over the past several  years,  the Company has focused its efforts on
expanding its range of services to include higher margin specialty services such
as IT staffing and  consulting,  administrative  staffing  support  services for
medical   facilities   and  other   professional   services.   The  Company  has
de-emphasized  marketing to accounts  where  competitive  pricing  makes margins
unacceptable or to accounts where workers'  compensation  costs adversely affect
profitability.

         Offer a Broad  Range  of  Services.  The  Company's  strategy  includes
offering  its  customers  a broad range of staffing  services,  including  light
industrial, clerical, IT, industrial, technical and other professional services,
as well as a range of  consulting  services  (including  telephony,  information


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technology and general business consulting,  as well as strategic planning). The
Company also provides related services to its customers,  including  payrolling,
skill and drug  testing,  risk  management  consulting  and  other  professional
staffing services.  In larger markets, the Company offers these services through
several separate  offices  operating under  established  names. The Company also
provides  outsourcing  services to  customers  whereby the Company  contracts to
perform a particular  business  function  for an agreed  price,  which  includes
providing  staffing,  equipment and supplies.  The Company is also expanding its
on-site  services,  in which SOS  locates an on-site  manager at the  customer's
facility to manage all of the customer's employee staffing requirements.

         Provide Centralized Support and Encourage  Entrepreneurial  Management.
The Company's commercial staffing offices are supported by centralized functions
at corporate  headquarters  that  include  marketing,  recruiting,  training and
retention  programs,  as well  as  workers'  compensation  and  other  insurance
services,  accounts  payable,   purchasing,   credit,  legal  review  and  other
administrative support services.  Generally,  each staffing office has access to
the  Company's  computer  system  and its  proprietary  software  that  provides
information on customer requirements,  available applicants,  staffing employees
on assignment and other  information  which  facilitates  efficient  response to
customer  job orders.  The Company is  expanding  IT  staffing,  consulting  and
outsourcing  operations and is developing a centralized  support system tailored
to the specific  needs of IT customers.  This  integration  will be completed in
1998.

         To  encourage  an  entrepreneurial  approach to field  management,  the
Company has  established  financial  targets and quality  performance  standards
which are utilized at all offices. A substantial  portion of the Company's field
management  compensation is  incentive-driven  and based upon meeting  financial
targets and quality standards.  Managers are also given considerable  discretion
to price services and to respond to specific customer requirements.

         Emphasize  Service and Value. The Company focuses on providing  service
and value to its customers.  The Company's staff employees seek to establish and
maintain long-term  relationships with its customers by developing  knowledge of
customers' businesses, responding promptly to customer orders and monitoring job
performance and customer  satisfaction.  The Company targets  customer  accounts
where  service  and  quality  are  perceived  to be as  important  as pricing of
services.  This allows the Company to be more  selective  and to provide  higher
quality services while maintaining desired margins.

         Pursue  Opportunities  in Small  Markets.  In the  commercial  staffing
segment,  SOS has  focused on opening  hub  offices  in key  metropolitan  areas
followed by  establishing  offices in surrounding  markets.  This  decentralized
office  management  strategy  locates  multiple  offices in close  proximity  to
customers and staffing employees. The Company believes this strategy has allowed
it to rapidly gain market share with low entry costs. Once a hub office has been
established,  the Company  focuses on leveraging hub office  resources to market
and deliver  services to  surrounding  smaller  markets and to cross-sell IT and
other specialty staffing services.  In these markets,  which are often too small
to attract substantial competition from national staffing companies, the Company
has quickly achieved  significant  penetration and has often become the dominant
provider of staffing services.


Growth Strategy

         Management believes the Company has substantial opportunities to expand
its office  network and the range of services  it offers to its  customers.  The
Company's  growth  strategy is comprised  of two  elements:  Continued  focus on
internal  growth and pursuit of additional  acquisitions.  Since  completing its
initial  public  offering  in July  1995,  the  Company  has added a total of 36
offices through internal growth and 56 offices through acquisitions.

         Focus on Internal Growth.  A principal  element of the Company's growth
strategy has been its focus on internal growth.  During the last five years, the
Company has maintained an average annual internal  revenue growth rate in excess
of 20%. The Company's internal growth strategy consists of the following:


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<PAGE>


           -   Increase Penetration of Existing Markets. The Company continually
              seeks to add new customers and offices in the  geographic  markets
              it currently serves.  In many instances,  the Company pursues such
              penetration  by  establishing  a "hub"  office  from  which it can
              develop  additional  offices within a metropolitan  area. SOS also
              intends  to  introduce  complementary  or  specialty  services  in
              existing  markets  and  incentivizes  field and local  managers to
              focus on business development within existing offices.

           -   Enter New  Markets.  The  Company  plans to open new  branches in
              markets not currently served by existing offices.  Frequently, the
              Company enters new markets by  establishing a "hub" office located
              in a central  location.  The  Company  then  opens new  offices in
              surrounding markets which benefit from the administrative  support
              and  resources  of the hub office.  This  strategy has enabled the
              Company to enter many smaller markets cost effectively.

           -   Expand  Service  Offerings.  The Company is  actively  seeking to
              expand  the range of IT  services  it offers to its  customers  to
              include expanded  outsourcing  capabilities and network  oversight
              and management,  and to add to its existing  telephony  consulting
              business.  The  Company  intends to expand  its vendor  on-premise
              business,  pursuant  to which SOS  manages  all of the  customer's
              staffing requirements on-site. The Company also intends to further
              develop partnering  relationships under which SOS works with other
              staffing providers to meet the customer's staffing requirements.

           -   Cross-sell  Services.  The Company  actively  seeks to cross-sell
              commercial  staffing  and IT staffing and  consulting  services to
              existing customers.  Through incentive compensation  arrangements,
              the Company actively encourages  referrals and cross-selling among
              and within its commercial, specialty and IT operations.

         Pursue  Acquisitions.   The  Company  intends  to  continue  to  pursue
acquisitions as a key element of its growth strategy. In targeting acquisitions,
SOS focuses on businesses  with (i) a history of profitable  operations,  (ii) a
strong management team, (iii) a strong local market position, (iv) services that
complement the Company's  operations and (v) compatible  corporate  philosophies
and culture.

           -   Enter New  Markets.  The  Company  intends  to  target  strategic
              acquisitions  in new markets  where the Company seeks to establish
              staffing operations, particularly in the western states.

           -   Acquire Complementary Businesses in Existing Markets. The Company
              intends to acquire complementary  businesses or specialty lines of
              business that enhance the services  provided by existing  offices.
              The Company also targets  businesses in its existing  markets as a
              means of increasing market share.

           -   Acquire New Services.  The Company intends to pursue acquisitions
              of staffing businesses that will expand its service offerings. The
              Company's  acquisition  of ten IT  companies  since  July 1996 has
              significantly   strengthened   the   Company's   IT  staffing  and
              consulting   offerings.   As  the  Company   identifies   staffing
              businesses in  attractive  niches,  the Company  intends to pursue
              strategic acquisitions to facilitate its entry into such niches.


Operations

         Services  Offered.  The  Company  offers a broad  range  of  commercial
staffing and IT staffing,  consulting, and outsourcing services.  Generally, the
Company provides light industrial,  clerical and industrial services through SOS
Staffing  Services,  Skill Staff  Industrial  Specialists and Century  Personnel
offices,  while technical and other specialty services are provided by specialty
offices  such  as  SOS  Technical  Services  (engineers,  chemists,  geologists,
designers,  drafters,   illustrators,   artists,  writers  and  other  technical


                                       4
<PAGE>


personnel),   AccountStaff  (accountants,   bookkeepers,  auditors,  data  entry
personnel  and financial  analysts),  PAMS  (medical  administrative  services),
National Collex (collection services and project billing for medical facilities)
and CGS Personnel  (mining,  mineral  exploration and  environmental  staffing).
Consulting  and  outsourcing  services are  provided  under the names of Wolfe &
Associates, Telecom Project Assistance and JesCo Technical Services. IT staffing
services are provided under various names. The Company intends to adopt a common
name for its IT staffing, consulting and outsourcing services.

         The Company's  commercial  staffing services also include  professional
employer services such as payrolling,  outsourcing,  on-site and  administrative
professional  services  provided  through  SOS  Staffing  Services  and  ServCom
offices.  Payrolling typically involves the transfer of a customer's  short-term
seasonal or special use  employees  to the  Company's  payroll for a  designated
period. Outsourcing represents a growing trend among businesses to contract with
third  parties to provide a particular  function or business  department  for an
agreed price over a  designated  period.  On-site  services  involve  locating a
regular SOS  employee at the  customer's  place of business to manage all of the
customer's temporary staffing requirements. Administrative professional services
offer SOS customers skills testing,  drug testing and risk management  services.
Skills testing available to SOS customers  includes  cognitive,  personality and
psychological  evaluations.  Drug tests are  confirmed  through  an  independent
certified laboratory. Risk management services include on-site safety inspection
and  consulting  services.  As of December 28, 1997,  the Company also  provided
professional  employer organization services on a limited basis to approximately
60 customers,  representing  approximately  425  employees,  which offers to SOS
customers the benefits of employee leasing.

         The  Company's  IT  services  consist of IT  staffing,  consulting  and
outsourcing  services.  The  Company's  IT staffing  services  include  computer
programming,  system design,  analysis and  administration,  network and systems
management and software and documentation development.  IT staffing services are
similar in many respects to commercial  staffing services;  however, IT services
generally  require   increased   specialization   and  technical  skill,   carry
significantly   higher  hourly  rates  and  involve   substantially  longer  job
assignments.  The  Company's IT  consulting  services are focused on solving the
customer's  organizational  problems and typically include  telephony  services,
general business consulting,  organizational analysis, technology consulting and
strategic planning.  Company  consultants provide innovative ideas,  insight and
experience to address the customer's organizational problems, then work with the
customer to implement strategic solutions.  IT consulting  engagements typically
last six months to one year and may require the services of several  specialized
consultants.  The Company also delivers IT outsourcing services to customers who
turn over to SOS  personnel  the  management  and staffing of specific  business
operations.  Historically,  the Company has provided IT staffing, consulting and
outsourcing  services  under the business  names of acquired IT business  units;
however,  as the Company integrates  acquired IT companies into its consolidated
IT  operations,  the  Company  intends to adopt  common  business  names for use
throughout the Company's IT branch network during 1998.

         Branch  Offices.  The  Company  provides  commercial  staffing  and  IT
staffing and consulting  services through a network of 134 offices located in 18
states.  The Company  currently  operates at least one office in every market in
the Mountain States (Arizona,  Colorado,  Idaho,  Montana,  New Mexico,  Nevada,
Utah, and Wyoming) with a population base in excess of 100,000 people. In larger
markets,  the Company generally provides light industrial and clerical personnel
through SOS Staffing Services offices,  while specialty services are provided by
service-specific  specialty  offices.  In smaller  markets,  SOS offices offer a
broader variety of commercial  staffing services including  specialty  services.
The Company currently provides commercial staffing services through a network of
SOS Staffing Services,  Century Personnel,  Skill Staff, SOS Technical Services,
AccountStaff, Industrial Specialist, PAMS, ServCom and CGS offices.

         The Company estimates the capital cost of establishing a new commercial
staffing  offices ranges from $15,000 to $50,000,  exclusive of working  capital
requirements. The Company's new offices have historically achieved profitability
in six to 12 months, while offices created by division of an existing office are
usually profitable from inception.

         The Company  provides IT staffing and  consulting  services  from 18 IT
offices. The Company's IT staffing and consulting offices generally serve larger
geographic  areas than SOS commercial  staffing  offices  principally due to the


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increased specialization  associated with IT services. The Company's strategy of
integrating and expanding its existing IT staffing and consulting office network
will include  efforts to position IT offices in strategic  locations  throughout
the western states, rather than the "hub and spoke" approach used by the Company
to expand its network of commercial staffing offices.

         Sales and  Marketing.  SOS generally  markets its  commercial  staffing
services  through  its  network  of offices  whose  managers,  supported  by the
Company's marketing staff, make regular personal sales visits to larger accounts
and prospects.  The Company emphasizes long-term personal relationships with its
customers and develops these  relationships  through regular  contact,  periodic
assessment  of  customer   requirements  and  regular   monitoring  of  employee
performance.   New   customers   are  obtained   through   customer   referrals,
telemarketing  and  advertising  in a  variety  of  local  and  regional  media,
including television,  radio, direct mail, Yellow Pages,  newspapers,  magazines
and trade  publications.  The  Company  is also a sponsor of job fairs and other
community  events.  In  addition,  the Company  uses the Internet to support its
marketing efforts.

         The Company's IT sales and marketing efforts may include the activities
described  above,  but are  generally  more  focused to address IT staffing  and
consulting needs which are typical of specific customers.  Many of the Company's
existing and prospective IT customers routinely outsource IT functions,  such as
programming,  data entry and network  administration.  The Company's IT staffing
and consulting  personnel seek to identify IT  requirements of its customers and
promote IT services designed to meet those requirements. In addition to personal
sales visits,  targeted mailings and telephone  solicitations,  the Company's IT
personnel  actively  promote  the  Company's   services  through   cross-selling
complementary  IT services to existing  customers  and  participate  in industry
trade associations.

         Recruiting.  The  Company  believes  a key  element  of its  growth and
profitability  has been its  ability to recruit  and retain  qualified  staffing
personnel.  In an effort to attract commercial staffing  personnel,  the Company
employs recruiters who regularly visit schools and professional associations and
present career development program to various  organizations.  In addition,  the
Company  obtains  applicants  from referrals by its staffing  employees and from
advertising  on radio,  television,  in the Yellow Pages and through other print
media.  The  Company  has  recently  begun to utilize  the  Internet  to recruit
professional,  IT  and  technical  staffing  employees.  Each  applicant  for  a
commercial   staffing  position  is  interviewed  with  emphasis  on  past  work
experience, personal characteristics and individual skills. The Company utilizes
the Dictionary of Occupational  Titles ("DOT Codes") published by the Department
of Labor to  evaluate  and assign  staffing  employees.  The  Company  maintains
software-training  programs at its offices for  applicants and employees who may
be trained and tested at no cost to the applicant, employee or Company customer.

         The Company's  efforts to recruit IT staffing and consulting  personnel
frequently  include  some or all of the  recruiting  activities  employed by the
Company's  commercial  staffing  offices,  but  typically  rely more  heavily on
identifying potential employees who possess specialized  education,  training or
work experience.  Frequently,  the Company will screen  prospective IT personnel
based  solely  upon  resume  submissions,  then refer  qualified  candidates  to
customers for on-site interviews.  The Company's IT recruiting efforts also rely
heavily upon industry  contacts,  personal  networks and referrals from existing
and former IT personnel.

         To promote  loyalty and  retention  among its staffing  employees,  the
Company  provides  its  staffing   employees  with  certain  employee  benefits,
including access to a Section 401(k) defined  contribution  plan, a credit union
and health  insurance  programs  offered  through the  National  Association  of
Temporary  and Staffing  Services  ("NATSS").  In addition,  the Company has the
ability to issue paychecks to commercial staffing employees during the same week
worked.

         Customers.  During the 52 weeks ended  December 28,  1997,  the Company
provided approximately 78,000 staffing employees to more than 10,000 businesses,
professional  and service  organizations  and government  agencies.  No customer
accounted for more then 2% of the Company's  service  revenues during the period
and the  Company's  top ten  customers  accounted  for less than 11% of  service
revenues  during the same period.  Historically,  the Company's  customers  have
consisted   primarily  of  small  to  mid-size  commercial  staffing  customers.
Management believes there remain significant opportunities to deliver profitable
commercial  staffing  services  to small and  mid-size  customers,  who are less
likely  to  require   substantial  volume  discounts  than  larger,   nationwide


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companies.  As the Company expands its network into larger cities in the western
states,  the  Company  anticipates  that it  will  provide  commercial  staffing
services  to larger  customers  who focus on value  rather  than cost,  but will
continue to focus its efforts on attracting  and providing  quality  services to
small and mid-size companies located in such larger cities.

         The  Company's  IT  customer  base,  which  consists  primarily  of  IT
customers  served  by  companies  acquired  by SOS  since  July  1996,  includes
customers  who  are  generally  larger  than  many of the  Company's  commercial
staffing  customers.  Many  of the  Company's  IT  customers  are  Fortune  1000
companies,  government  agencies  and  educational  institutions.  Many  of  the
projects are smaller in scope than those done by large  national  companies.  On
larger projects, the Company frequently provides service in a supporting role to
the project  manager.  The Company  anticipates  that its increased  focus on IT
staffing  and  consulting,  as well as its  expansion  into larger  metropolitan
areas, will lead to additional  opportunities to provide IT services to mid-size
and larger customers.

         Risk Management  Program.  SOS is responsible for all  employee-related
expenses for its staff employees including workers'  compensation,  unemployment
insurance,  social  security  taxes,  state  and local  taxes and other  general
payroll expenses. The Company has implemented a deductible workers' compensation
program  through  CIGNA  Property  and  Casualty  ("CIGNA")  with a loss  cap of
$200,000 per incident.  Staffing employees in Nevada, Washington and Wyoming are
insured through those states'  insurance funds because private  insurance is not
permitted in those states.  The Company  employs a full-time  professional  risk
manager and staff who work closely with the  insurance  carrier to manage claims
and establish appropriate reserves.

         The Company  has also  developed  workers'  compensation  loss  control
programs which seek to limit claims through  employee  training and avoidance of
high risk job assignments such as roofing or logging. All staffing employees are
required to agree in advance to drug testing following any work-related accident
and all major accidents are investigated.  The Company,  in cooperation with its
insurer,  monitors all claims and regularly  reviews the claims with an emphasis
on early closure.


Information Systems

         The Company's central management information system is linked to all of
the Company's  larger  commercial  staffing  offices.  Smaller  offices  utilize
stand-alone computers or batch access software for routine office functions. The
centralized  system is  designed  to  support  Company-wide  operations  such as
payroll, billing, accounting and sales and management reports.

         Six of the Company's 18 IT offices are linked to the Company's  central
management  information system, while substantially all of the remaining offices
continue to utilize  systems in place at the time of their  acquisition  by SOS.
The Company is developing a central management information system for use by the
Company's  IT  offices.  The  Company  anticipates  that its IT  system  will be
connected  to the  Company's  existing  system  for  certain  common  functions;
however,  the IT system will be designed to accommodate  the different  business
cycles and processes associated with the IT industry.

         The  current  operating  system  software  utilized  by the  Company is
licensed  on  a  perpetual   royalty-free   basis.  The  Company's   proprietary
application  software is  regularly  updated  and revised to meet the  Company's
specific requirements. All files are backed up routinely and stored off-site and
critical  files are backed up on a daily basis.  The present system has capacity
to  service  the  Company's   anticipated  growth  without  significant  capital
expenditures for the foreseeable future.



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Year 2000

         The  Company's   information   systems  have  been  made  substantially
compliant  with Year 2000  requirements.  Reviews are beginning of the Company's
key vendors'  compliance with these  requirements.  No determination of material
compliance or noncompliance of key vendors can be made at this time.


Competition

         The staffing  industry is  comprised  of  national,  regional and local
companies  operating offices  throughout the nation,  making the industry highly
competitive and highly  fragmented,  with limited barriers to entry. The Company
faces intense  competition from large national and international  companies with
substantially  greater  financial  and  marketing  resources  than  those of the
Company, as well as strong local and regional staffing companies.

         The Company competes for qualified staffing employees and for customers
who require the services of such employees. The principal competitive factors in
attracting and retaining  qualified staffing employees are competitive  salaries
and  benefits,  quality and  frequency  of  assignments  and  responsiveness  to
employee  needs.  The Company  believes  that many  persons  who seek  temporary
employment  are also seeking  regular  employment and that the  availability  of
assignments  which may lead to regular  employment is an important factor in its
ability to attract qualified staffing employees.

         The principal  competitive  factors in obtaining customers are a strong
sales and marketing program,  having qualified staffing employees to assign in a
timely  manner,  matching  of  customer  requirements  with  available  staffing
employees,  competitive  pricing and satisfactory  work production.  The Company
believes its strong emphasis on providing service and value to its customers and
staffing employees are important competitive advantages.


Seasonality

         The Company's  business  follows the seasonal  trends of its customers'
businesses.  Historically,  the Company has  experienced  lower  revenues in the
first  quarter due to the seasonal  trends of its  customers  and lower  overall
economic activity.


Trade Names

         The  Company  uses a variety of  trademarks  and trade  names which are
generally descriptive of the temporary staffing services offered,  including SOS
Staffing Services, Century Personnel, Skill Staff, AccountStaff, TSI, Industrial
Specialists, SOS Technical Services, ServCom, PAMS Employment Services, National
Collex,  CGS Personnel,  Wolfe & Associates,  Impact  Staffing,  The Performance
Group,  Computer Group, Inc., Telecom Project Assistance,  Bedford  Consultants,
Execusoft,  JesCo Technical  Services,  CenTech,  and Prestige  Consulting trade
names. The Company has registered or reserved the majority of these names in the
appropriate  states. The Company  anticipates that at some future date the trade
names used in its IT staffing, consulting and outsourcing operations,  including
Wolfe & Associates,  Impact  Staffing,  The Performance  Group,  Computer Group,
Inc.,  Telecom  Project  Assistance,   Bedford  Consultants,   Execusoft,  JesCo
Technical  Services,  CenTech and Prestige Consulting may be modified or changed
to reflect their common business focus.


Staff Employees

         At December 28, 1997, the Company had approximately 776 staff employees
consisting of 14 senior  managers,  127 field managers,  119 consultants and 516
other staff employees.  The Company's training  department  provides general and
job specific training to all staff employees, including continuing training with


                                       8
<PAGE>


experienced  counterparts.  None of the Company's  staff employees is covered by
collective  bargaining  agreements.  The Company considers its relationship with
its staff employees to be good.


Factors that May Affect Future Results

         The  statements  contained in this Annual  Report on Form 10-K that are
not purely  historical are  "forward-looking  statements"  within the meaning of
Section 27A of the  Securities  Act of 1933, as amended,  and Section 21E of the
Securities  Exchange Act of 1934,  as amended.  All  forward-looking  statements
involve various risks and uncertainties. Forward-looking statements contained in
this Report include  statements  regarding the Company's  acquisition  plans and
opportunities,  existing and proposed service offerings,  market  opportunities,
expectations, goals, revenues, financial performance, strategies, intentions for
the  future  and any other  statements  to the  effect  that the  Company or its
management  "believes",  "expects",  "anticipates",  "plans"  or  other  similar
expressions.   Such  forward-looking  statements  are  included  under  Item  1.
"Business",  Item 2.  "Properties",  Item 3.  "Legal  Proceedings"  and  Item 7.
"Management's  Discussion  and  Analysis of Financial  Condition  and Results of
Operations." All forward-looking  statements included in this Report are made as
of the date  hereof,  based on  information  available to the Company as of such
date,  and the  Company  assumes no  obligation  to update  any  forward-looking
statement.  It is  important  to note that such  statements  may not prove to be
accurate,  and that the Company's  actual results and future events could differ
materially from those  anticipated in such statements.  Many factors could cause
actual results to differ materially from the Company's expectations,  including,
without limitation, the factors identified below.

         The Company's  future results will be impacted by, among other factors,
the  Company's  ability to implement  its growth  strategy,  which,  in turn, is
dependent  upon a number of  factors,  including  the  availability  of  working
capital to support such  growth,  plans to expand the  Company's  offering of IT
staffing services,  competition for attractive  acquisition  opportunities,  the
Company's   ability  to  integrate  the   operations  of  acquired   businesses,
management's  ability and  resources  to implement  the growth  strategy and the
successful hiring, training and retention of qualified field management.  Future
results will also be affected by other factors  associated with the operation of
the  Company's  business,  including  the  Company's  response to  existing  and
emerging competition, demand for the Company's services, effects associated with
the recent  transition  within the Company's  senior  management,  the Company's
ability  to  maintain  profit  margins  in the face of  pricing  pressures,  the
Company's efforts to develop and maintain  customer and employee  relationships,
economic fluctuations and employee-related risks and expenses.

         All subsequent written and oral forward-looking statements attributable
to the Company or persons acting on its behalf are expressly  qualified in their
entirety by this section and other  factors  included  elsewhere in this Report.
You also  should  consult  other  factors  identified  from  time to time in the
Company's periodic reports to the Securities and Exchange Commission.


ITEM 2.  PROPERTIES
         ----------

         As of December 28, 1997, the Company provided staffing services through
134  offices in 18 states.  These  offices  typically  consist of 1,200 to 5,000
square  feet and are  leased by the  Company  for terms of three to five  years.
Offices in larger or smaller  markets may vary in size from the typical  office.
The Company does not expect that  maintaining or finding suitable lease space at
reasonable  rates in its  markets  or in areas  where the  Company  contemplates
expansion will be difficult.

         The Company's executive and administrative  offices are located in Salt
Lake City, Utah. The premises  consist of  approximately  15,600 square feet and
are leased  from a related  party for a term ending on March 31,  2005,  with an
option to renew for 10 additional  years (see "Certain  Relationship and Related
Parties").  The Company  believes that the lease terms are at least as favorable
as could be obtained from any unrelated third party.


                                       9
<PAGE>


ITEM 3.  LEGAL PROCEEDINGS
         -----------------

         In the ordinary  course of its  business,  the Company is  periodically
threatened  with or  named as a  defendant  in  various  lawsuits.  The  Company
maintains  insurance in such amounts and with such coverage and  deductibles  as
management believes to be reasonable and prudent. The principal risks covered by
insurance  include  worker's  compensation,   personal  injury,  bodily  injury,
property damage, errors and omissions, fidelity losses and general liability.

         In June 1997,  a former  customer of the Company  commenced  litigation
against the  Company in Second  District  Court,  Davis  County,  State of Utah,
alleging  breach  of  contract,  negligence,  fraud and  misrepresentation.  The
allegations are based upon the alleged theft of surplus  military goods from the
former customer's  warehouse by a former temporary employee of the Company.  The
plaintiff is seeking special, general, consequential, punitive and other damages
in an amount in excess of $7 million.  In September  1997,  the Company  filed a
motion to dismiss  the  negligence  claim  based on the  pleadings  and filed an
answer to the complaints denying the material  allegations and asserting several
affirmative defenses. In December 1997, the judge denied the Company's motion to
dismiss without  prejudice.  The Company believes the claim is without merit and
that the Company  has valid  defenses  to all of the  allegations  raised by the
plaintiff.

         There  is no  other  pending  litigation  that  the  Company  currently
anticipates  will have a  material  adverse  effect on the  Company's  financial
condition or results of operations.


ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
         ---------------------------------------------------

         No matters  were  submitted  to a vote of security  holders  during the
fourth quarter of the 52 weeks ended December 28, 1997.


                                     PART II

ITEM 5.  MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED SHAREHOLDER MATTERS
         ---------------------------------------------------------------------

         The  information  required by this Item is incorporated by reference to
page 33 of the Company's 1997 Annual Report to Shareholders.


ITEM 6.  SELECTED FINANCIAL DATA
         -----------------------

         The  information  required by this Item is incorporated by reference to
page 1 of the Company's 1997 Annual Report to Shareholders.


ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         -----------------------------------------------------------------------
         OF OPERATIONS
         -------------
         The  information  required by this item in incorporated by reference to
pages 9 through 12 of the Company's 1997 Annual Report to Shareholders.


ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
         ----------------------------------------------------------

         Not applicable


                                       10
<PAGE>


ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTAL DATA
         ------------------------------------------

         The  information  required by this item in incorporated by reference to
pages 13 through 32 of the Company's 1997 Annual Report to Shareholders.


ITEM 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
         ---------------------------------------------------------------
         FINANCIAL DISCLOSURE
         --------------------

         None

                                    PART III

         The  information  required by this Part III is omitted from this Report
in that the Company  will file with the  Securities  and  Exchange  Commission a
definitive proxy statement for the Annual Meeting of Shareholders of the Company
to be held on May 13,  1998 (the  "Proxy  Statement"),  not later  that 120 days
after  December  28,  1997,  and  certain   information   included   therein  is
incorporated  herein by reference.  Only those  sections of the Proxy  Statement
specifically  identified  below  which  address  the items set forth  herein are
incorporated by reference.


ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
         --------------------------------------------------

         The  information  required by this Item is incorporated by reference to
the sections  entitled  "Election of Directors",  "Executive  Officers" and "Key
Employees" in the Proxy Statement.


ITEM 11. EXECUTIVE COMPENSATION
         --------------------

         The  information  required by this Item is incorporated by reference to
the  sections  entitled  "Election  of   Directors-Director   Compensation"  and
"Executive Officers-Executive Compensation" in the Proxy Statement.


ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
         --------------------------------------------------------------

         The  information  required by this Item is incorporated by reference to
the  section  entitled  "Principal  Holders of Voting  Securities"  in the Proxy
Statement.


ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSATIONS
         ---------------------------------------------

         The  information  required by this item is incorporated by reference to
the section entitled  "Certain  Relationships  and Related  Transactions" in the
Proxy Statement.






                                       11
<PAGE>




                                     PART IV

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K
         ---------------------------------------------------------------

(a)      The following documents are filed as part of this Report:

1.       Consolidated Financial Statements: The following Consolidated Financial
         Statements of the Company and Report of Independent Public Accountants,
         are  incorporated  by reference to pages 13 through 32 of the Company's
         1997 Annual Report to Shareholders:

         Consolidated  Balance Sheets--As of December 28, 1997, and December 29,
         1996

         Consolidated  Statements of Income--For the Fiscal Years Ended December
         28,  1997,  December 29,  1996,  and  December  31, 1995.  Consolidated
         Statements of Shareholders' Equity--For the Fiscal Years Ended December
         28, 1997, December 29, 1996 and December 31, 1995.

         Consolidated  Statements  of Cash  Flows--For  the Fiscal  Years  Ended
         December 28, 1997, December 29, 1996, and December 31, 1995.

         Notes to Consolidated Financial Statements

         Report of Independent Public Accountants

2.       Financial Statement Schedules

         No schedules submitted


(b)      Reports on Form 8-K:
         --------------------

         On October 14, 1997,  the Company  filed a Current  Report on Form 8-K,
         dated October 2, 1997, which the Company subsequently amended by filing
         an Amendment to Current  Report on Form 8-K/A on October 15, 1997.  The
         Report,  as  amended,  was  filed  for the  purpose  of  reporting  the
         Company's  acquisition of certain assets and  substantially  all of the
         business  operations  of  Century  Personnel,   Inc.,  and  M.A.  Jones
         Enterprises,  Inc. (collectively,  "Century").  No financial statements
         were  filed  with  the  Current  Report  or the  subsequent  amendment;
         however,  on November  24,  1997,  the Company  filed an  Amendment  to
         Current Report on Form 8-K/A for the purpose of providing the financial
         statements and pro forma financial  information  required in connection
         with  the  Company's  acquisition  of  Century's  assets  and  business
         operations.

         On November 12, 1997,  the Company  filed an Amendment No. 1 to Current
         Report on Form 8-K/A for the  purpose of  amending a Current  Report on
         Form 8-K,  dated  September  15,  1997,  in order to provide  financial
         statements and pro forma financial  information  required in connection
         with the Company's  acquisition of certain assets and substantially all
         of the business operations of JesCo Technical Services, Inc.

(c)      Exhibits:
         ---------
<TABLE>
<CAPTION>

   Exhibit                                                              Incorporated by     Filed Herewith
     No.                               Exhibit                             Reference
--------------- ------------------------------------------------------ ------------------- -----------------

     <S>        <C>                                                           <C>                <C>
     3.1        Amended and Restated Articles of Incorporation of             (1)
                the Company


                                       12
<PAGE>


<CAPTION>

   Exhibit                                                              Incorporated by     Filed Herewith
     No.                               Exhibit                             Reference
--------------- ------------------------------------------------------ ------------------- -----------------

     <S>        <C>                                                           <C>                <C>
     3.2        Amended and Restated Bylaws of the Company                    (1)


     4.2        Amended and Restated Articles of Incorporation of             (1)
                the Company

     4.3        Amended and Restated Bylaws of the Company                    (1)

     10.1       SOS Staffing Services, Inc. Stock Incentive Plan              (3)
                dated May 4, 1995, as amended

     10.2       Form of Employment Agreement entered into by the              (1)
                Company and each of Messrs. Richard D. Reinhold,
                Howard W. Scott, Jr. and Richard J. Tripp

     10.3       Form of Consulting Agreement  between the Company             (2)
                and Ms. JoAnn W. Wagner, effective as of July 1, 1995


     10.4       Lease Agreement between the Company and Reed F.               (1)
                Reinhold, Rand F. Reinhold, Rena R. Qualls and Robb
                F. Reinhold, dated April 1, 1995, covering the
                Company's Corporate office building

     10.5       Credit Agreement dated as of July 11, 1996 by and             (4)
                among the Company, First Security Bank, N.A. and NBD
                Bank, together with Security Agreement and Revolving
                Credit Notes

     10.6       Stock Purchase Agreement between the Company, Wolfe           (5)
                & Associates, Inc. and certain shareholders of Wolfe
                & Associates, Inc. dated November 5, 1996

     10.7       Asset Purchase Agreement between the Company,                 (6)
                Execusoft, Inc. and the principals of Execusoft,
                Inc., effective as of August 27, 1997

     10.8       Asset Purchase Agreement between Wolfe & Associates,          (7)
                Inc., the Company, JesCo Technical Services, Inc.,
                and John E. Shaffer, effective September 28, 1997

     10.9       Asset Purchase Agreement between the Company,                 (8)
                Century Personnel, Inc., M.A. Jones Enterprises,
                Inc. and Michael A. Jones, effective October 27, 1997

      13        Annual Report to Shareholders for the year ended                                 (9)
                December 28, 1997 by reference into Items 5 through
                8 of this Annual Report on Form 10-K and, except as
                so incorporated by reference, the Annual Report to
                Shareholders is not deemed to be filed as part of
                this Report.


                                       13
<PAGE>

<CAPTION>

   Exhibit                                                              Incorporated by     Filed Herewith
     No.                               Exhibit                             Reference
--------------- ------------------------------------------------------ ------------------- -----------------

     <S>        <C>                                                                              <C>
      21        Subsidiaries of the Company                                                      (9)

     23.2       Consent of Independent Public Accountants                                        (9)

      27        Financial Data Schedule                                                          (9)
</TABLE>

(1)      Incorporated  by reference to the exhibits to a Registration  Statement
         on Form S-1 filed by the  Company  on May 17,  1995,  Registration  No.
         33-92268.

(2)      Incorporated  by  reference  to the  exhibits to  Amendment  No. 1 to a
         Registration Statement on Form S-1 filed on June 22, 1995, Registration
         No. 33-92268.

(3)      Incorporated  by  reference  to the  exhibits to the  Company's  Annual
         Report of Form 10-K for the year ended  December  31, 1995 filed by the
         Company on March 29, 1996.

(4)      Incorporated by reference to the exhibits to a Quarterly Report on Form
         10-Q for the quarter  ended  September 26, 1996 filed by the Company on
         November 14, 1996.

(5)      Incorporated  by reference to the exhibits to a Current  Report on Form
         8-K filed by the Company on November 14, 1996.

(6)      Incorporated  by reference to the exhibits to a Current  Report on Form
         8-K filed by the Company on September 3, 1997.

(7)      Incorporated  by reference to the exhibits to a Current  Report on Form
         8-K filed by the Company on September 18, 1997.

(8)      Incorporated  by  reference  to the exhibits to an Amendment to Current
         Report on Form 8-K/A filed by the Company on October 15, 1997.

(9)      Filed herewith and attached to this Report following page 13 hereof.


(d)      Financial Statement Schedules:
         ------------------------------

         No schedules submitted.




                                       14
<PAGE>




                                   SIGNATURES

Pursuant to the  requirements of Section 13 or 15(d) of the Securities  Exchange
Act of 1934,  the  Registrant  has duly  caused  this report to be signed on its
behalf by the undersigned, thereto duly authorized.

                           SOS STAFFING SERVICES, INC.

Date:  March 23, 1998               By:      /s/ Gary B. Crook
                                             -----------------
                                             Gary B. Crook
                                             Executive Vice President, Treasurer
                                             and Chief Financial Officer


Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following  persons on behalf of the  Registrant and
in the capacities and on the dates indicated.

Name                        Title                                 Date
----                        -----                                 ----

/s/ JoAnn W. Wagner         Chairman of the Board and             March 23, 1998
 ------------------         Executive Vice President
JoAnn W. Wagner

/s/ Howard W. Scott, Jr.    Director, Chief Executive            March 23, 1998
 -----------------------    Officer (Principal Executive
Howard W. Scott, Jr.        Officer)

/s/ Peter R. Sollenne       Director, President and Chief        March 23, 1998
---------------------       Operating Officer
Peter R. Sollenne

/s/ Gary B. Crook           Executive Vice President, Treasurer  March 23, 1998
-----------------           and Chief Financial Officer
Gary B. Crook               (Principal Financial and Accounting
                            Officer)

/s/ Richard J. Tripp        Director and                         March 23, 1998
--------------------
Richard J. Tripp            Senior Vice President

/s/ Stanley R. deWaal       Director                             March 23, 1998
---------------------
Stanley R. deWaal

/s/ Samuel C. Freitag       Director                             March 23, 1998
 --------------------
Samuel Freitag

/s/ R. Thayne Robson        Director                             March 23, 1998
--------------------
R. Thayne Robson

/s/ Randolph K. Rolf        Director                             March 23, 1998
--------------------
Randolph K. Rolf

/s/ Annette Strauss         Director                             March 23, 1998
-------------------
Annette Strauss


                                       15