U.S. SECURITIES AND EXCHANGE COMMISSION
                               WASHINGTON, DC  20549

                                   FORM 10-QSB


  [X]  Quarterly Report Under Section 13 or 15(d) of the Securities Exchange
       Act of 1934

       For the quarterly period ended March 31, 2006

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

                             Commission File Number 1-05707


                         GENERAL EMPLOYMENT ENTERPRISES, INC.
          (Exact name of small business issuer as specified in its charter)

                  Illinois                                36-6097429
     (State or other jurisdiction of                   (I.R.S. Employer
      incorporation or organization)                Identification Number)

          One Tower Lane, Suite 2200, Oakbrook Terrace, Illinois 60181
                    (Address of principal executive offices)

                                  (630) 954-0400
                           (Issuer's telephone number)

Check whether the issuer is not required to file reports pursuant to
Section 13 or 15(d) of the Exchange Act.  [ ]

Note - Checking the box above will not relieve any registrant
required to file reports pursuant to Section 13 or 15(d) of the
Exchange Act from their obligations under those Sections.

Check whether the issuer (1) filed all reports required to be
filed by Section 13 or 15(d) of the Securities Exchange Act
during the past 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 whether the registrant is a shell company
(as defined in Rule 12b-2 of the Exchange Act).    Yes [ ]    No [X]

The number of shares outstanding of the issuer's common stock as of
March 31, 2006 was 5,148,265.

Transitional small business disclosure format:     Yes [ ]    No [X]



                 PART I - FINANCIAL INFORMATION

Item 1, Financial Statements.

GENERAL EMPLOYMENT ENTERPRISES, INC.
CONSOLIDATED BALANCE SHEET
                                                  March 31    September 30
                                                      2006            2005
(In Thousands)                                  (Unaudited)

ASSETS
Current assets:
Cash and cash equivalents                             $5,143        $5,236
Accounts receivable, less allowances
   (Mar. 2006--$368; Sept. 2005--$270)                 2,161         2,028
Other current assets                                     533           468

Total current assets                                   7,837         7,732
Property and equipment, net                              585           632

Total assets                                          $8,422        $8,364


LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accrued compensation                                  $1,717        $1,834
Other current liabilities                                552           680

Total current liabilities                              2,269         2,514

Shareholders' equity:
Preferred stock, authorized -- 100 shares;
   issued and outstanding -- none                         --            --
Common stock, no-par value; authorized --
   20,000 shares; issued and outstanding --
   5,148 shares                                        4,839         4,839
Retained earnings                                      1,314         1,011

Total shareholders' equity                             6,153         5,850

Total liabilities and shareholders' equity            $8,422        $8,364

See notes to consolidated financial statements.

                                      2


GENERAL EMPLOYMENT ENTERPRISES, INC.
CONSOLIDATED STATEMENT OF INCOME (Unaudited)
                                             Three Months         Six Months
                                           Ended March 31     Ended March 31
(In Thousands, Except Per Share)           2006      2005     2006      2005

Net revenues:
Contract services                         $2,685   $2,771    $5,323   $5,730
Placement services                         2,315    1,981     4,390    3,904

Net revenues                               5,000    4,752     9,713    9,634

Operating expenses:
Cost of contract services                  1,902    1,977     3,758    4,060
Selling                                    1,420    1,257     2,690    2,411
General and administrative                 1,554    1,510     3,056    3,056

Total operating expenses                   4,876    4,744     9,504    9,527

Income from operations                       124        8       209      107
Investment income                             51       13        94       33

Net income                                $  175   $   21    $  303   $  140

Average number of shares:
Basic                                      5,148    5,141     5,148    5,139
Diluted                                    5,328    5,383     5,351    5,390

Net income per share - basic and diluted  $  .03   $   --    $  .06   $  .03

See notes to consolidated financial statements.

                                      3


GENERAL EMPLOYMENT ENTERPRISES, INC.
CONSOLIDATED STATEMENT OF CASH FLOWS (Unaudited)

                                                                Six Months
                                                            Ended March 31
(In Thousands)                                          2006          2005

Operating activities:
Net income                                            $  303        $  140
Depreciation and other noncurrent items                   80           139
Accounts receivable                                     (133)          (81)
Accrued compensation and payroll taxes                  (117)          214
Other current items, net                                (193)         (410)

Net cash provided (used) by operating activities         (60)            2

Investing activities:
Acquisition of property and equipment                    (33)           --

Financing activities:
Exercises of stock options                                --             5

Increase (decrease) in cash and cash equivalents         (93)            7
Cash and cash equivalents at beginning of period       5,236         4,437

Cash and cash equivalents at end of period            $5,143        $4,444

See notes to consolidated financial statements.

                                      4


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)


Basis of Presentation

The accompanying unaudited consolidated financial statements have
been prepared in accordance with generally accepted accounting
principles for interim financial information and with the
instructions to Form 10-QSB.  Accordingly, they do not include
all of the information and footnotes required by generally
accepted accounting principles for complete financial statements.
In the opinion of management, all adjustments (consisting of
normal recurring accruals) considered necessary for a fair
presentation have been included.  This financial information
should be read in conjunction with the financial statements
included in the Company's annual report on Form 10-KSB for the
year ended September 30, 2005.


Income Taxes

There was no provision for income taxes in either year, because
of the availability of operating losses carried forward from
prior years.


Commitments

As of March 31, 2006, the Company had contractual obligations to
purchase approximately $690,000 of recruitment advertising
through December 2007.



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


Overview

The Company provides contract and placement staffing services for
business and industry, specializing in the placement of
information technology, engineering and accounting professionals.
As of March 31, 2006, the Company operated 19 offices located in
10 states.

The Company's business is highly dependent on national employment
trends in general and on the demand for professional staff in
particular.  As an indicator of employment conditions, the
national unemployment rate was 4.7% in March 2006 and 5.2% in
March 2005.  The change indicates a trend toward fuller employment.

During the six months ended March 31, 2006, the Company
experienced stronger demand for its placement services, but
weaker demand for its contract services, compared with the same
period last year.  These conditions led to an increase in the
number of placements, while billable contract hours decreased.
However, increased emphasis on higher-paid contract positions
resulted in a higher average hourly billing rate for contract services.

Consolidated net revenues for the six months ended March 31, 2006
were up 1% compared with the prior year.  Contract service
revenues were down 7%, while placement service revenues were up
12%.  As a result of the change in the mix, placement service
revenues increased to 45% of consolidated revenues from 41% last
year. Consolidated net income was $303,000 this year, which was
116% more than last year.

                                      5


The Company's past revenues and revenue patterns are not
necessarily indicative of future performance.  While it is
difficult to accurately predict future hiring patterns or the
demand for staffing services, management believes the Company
is well positioned for growth of its operations.  Existing branch
offices have the capacity to accommodate additional consulting
staff and a higher volume of business.

The Company had a net cash outflow of $93,000 for the six-month
period, due to working capital requirements, and the balance of
cash and cash equivalents was $5,143,000 as of March 31, 2006.


Results of Operations

A summary of operating data, expressed as a percentage of
consolidated net revenues, is presented below.


                                                                Six Months
                                                            Ended March 31
                                                            2006      2005
Net revenues:
Contract services                                           54.8%     59.5%
Placement services                                          45.2      40.5

Net revenues                                               100.0     100.0

Operating expenses:
Cost of contract services                                   38.7      42.1
Selling                                                     27.7      25.0
General and administrative                                  31.5      31.7

Total operating expenses                                    97.8      98.9

Income from operations                                       2.2%      1.1%


Net Revenues
Consolidated net revenues for the six months ended March 31, 2006
were up $79,000 (1%) from the prior year.  Contract service
revenues decreased $407,000 (7%) during the period, while
placement service revenues increased $486,000 (12%).

The decrease in contract service revenues was due to an 18%
decrease in the number of billable hours, which was partially
offset by a 12% increase in the average hourly billing rate.
Placement service revenues were up for the period because of an
11% increase in the number of placements.


Operating Expenses
Total operating expenses for the six months ended March 31, 2006
were down $23,000 compared with the prior year.

The cost of contract services was down $302,000 (7%), as a result
of the lower volume of contract business.  The gross profit
margin on contract business was 29.4% for the six months ended
March 31, 2006, which was slightly higher than 29.1% the prior
year.  There are no direct costs associated with placement
service revenues.

Selling expenses increased $279,000 (12%) for the period, due to
higher commission expense resulting from the higher placement
service revenues.
Selling expenses represented 27.7% of consolidated net revenues,
which was up 2.5 points from the prior year because of the change
in revenue mix.

                                      6


General and administrative expenses for the six months ended
March 31, 2006 were the same as last year, and they represented
31.5% of consolidated revenues.

There was no provision for income taxes in either year, because
of the availability of operating losses carried forward from
prior years.


Financial Condition

As of March 31, 2006, the Company had cash and cash equivalents
of $5,143,000, which was a decrease of $93,000 from September 30,
2005.  Net working capital at March 31, 2006 was $5,568,000,
which was an increase of $350,000 from September 30, 2005, and
the current ratio was 3.5 to 1.  The Company had no long-term
debt.  Shareholders' equity as of March 31, 2006 was $6,153,000,
which represented 73% of total assets.

During the six months ended March 31, 2006, the net cash used by
operating activities was $60,000.  Net income for the period,
together with depreciation and other non-cash charges, provided
$383,000, while working capital items used $443,000.

During fiscal 2006, the Company initiated a program to upgrade
its operational and administrative computer systems.  The Company
expects to spend approximately $800,000 between April 2006 and
December 2007 for the acquisition of equipment in connection with
this program, although there are no contractual obligations to do so.

The Company's primary source of liquidity is from its operating
activities.  The Company's philosophy regarding the maintenance
of cash balances reflects management's views on potential future
needs for liquidity.  Management believes that funds generated by
operations, together with existing cash balances, will be
adequate to finance current operations and capital expenditures
for the foreseeable future.


Off-Balance Sheet Arrangements

As of March 31, 2006, and during the six months then ended, there
were no transactions, agreements or other contractual
arrangements to which an unconsolidated entity was a party, under
which the Company (a) had any direct or contingent obligation
under a guarantee contract, derivative instrument or variable
interest in the unconsolidated entity, or (b) had a retained or
contingent interest in assets transferred to the unconsolidated entity.


Forward-Looking Statements

As a matter of policy, the Company does not provide forecasts of
future financial performance.  However, the Company and its
representatives may from time to time make written or verbal
forward-looking statements, including statements contained in
press announcements, reports to shareholders and filings with the
Securities and Exchange Commission.  All statements which address
expectations about future operating performance and cash flows,
future events and business developments, and future economic
conditions are forward-looking statements within the meaning of
the Private Securities Litigation Reform Act of 1995.  These statements
are based on management's then-current expectations and assumptions.
Actual outcomes could differ significantly.  The Company and its
representatives do not assume any obligation to provide updated information.

                                      7


Some of the factors that could affect the Company's future
performance include, but are not limited to, general business
conditions, the demand for the Company's services, competitive
market pressures, the ability of the Company to attract and
retain qualified personnel for regular full-time placement and
contract assignments, and the ability to attract and retain
qualified corporate and branch management.


Item 3, Controls and Procedures.

As of March 31, 2006, the Company's management evaluated, with
the participation of its principal executive officer and its
principal financial officer, the effectiveness of the Company's
disclosure controls and procedures, as defined in Rules 13a-15(e)
and 15d-15(e) of the Securities Exchange Act of 1934 (the
"Exchange Act").  Based on that evaluation, the Company's
principal executive officer and its principal financial officer
concluded that the Company's disclosure controls and procedures
were adequate as of March 31, 2006 to ensure that information
required to be disclosed in reports filed or submitted by the
Company under the Exchange Act is recorded, processed, summarized
and reported, within the time periods specified in the Securities
and Exchange Commission's rules and forms.

There was no change in the Company's internal control over
financial reporting that occurred during the Company's most
recent fiscal quarter that has materially affected, or is
reasonably likely to materially affect, the Company's internal
control over financial reporting.



                   PART II - OTHER INFORMATION


Item 4, Submission of Matters to a Vote of Security Holders.

At the annual meeting of shareholders on February 27, 2006, the
shareholders elected all of the nominees for election as
directors.  The name of each director elected, together with the
number of votes cast for elections and the number of votes
withheld, are presented below:

Nominees                     Votes For            Votes Withheld
Dennis W. Baker              4,136,635               596,001
Sheldon Brottman             4,139,757               592,879
Delain G. Danehey            4,132,162               600,474
Herbert F. Imhoff, Jr.       4,129,667               602,969
Joseph F. Lizzadro           4,139,279               593,357
Kent M. Yauch                4,137,162               595,474


Item 6, Exhibits.

The following exhibits are filed as a part of Part I of this report:

No.    Description of Exhibit

31.01  Certification of the principal executive officer required by Rule
       13a-14(a) or Rule 15d-14(a) of the Exchange Act.

31.02  Certification of the principal financial officer required by Rule
       13a-14(a) or Rule 15d-14(a) of the Exchange Act.

32.01  Certifications required by Rule 13a-14(a) or Rule 15d-14(a) of the
       Exchange Act and Section 1350 of Chapter 63 of Title 18 of the United
       States Code.

                                      8




                           SIGNATURES


In accordance with the requirements of the Exchange Act, the
registrant caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.


                                     GENERAL EMPLOYMENT ENTERPRISES, INC.
                                                 (Registrant)


Date:  May 4, 2006                   By:  /s/ Kent M. Yauch
                                     Kent M. Yauch
                                     Vice President, Chief Financial Officer
                                     and Treasurer (Principal financial and
                                     accounting officer and duly authorized
                                     officer)

                                      9