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                                                                    EXHIBIT 10.7

                              EMPLOYMENT AGREEMENT

This EMPLOYMENT AGREEMENT ("Agreement") made effective as of July 16, 2001 by
and between Alternative Resources Corporation (the "Company") and Miner Smith
(the "Executive").

In consideration of the mutual covenants contained in this Agreement, the
parties hereby agree as follows:

                                    SECTION I
                                   EMPLOYMENT

     The Company agrees to the continued employment of the Executive, and the
Executive agrees to be employed by the Company for the Period of Employment as
provided in Section III A. below upon the terms and conditions provided in the
Agreement.

                                   SECTION II
                          POSITION AND RESPONSIBILITIES

     During the Period of Employment, the Executive agrees to serve as
President--Field Operations, and to be responsible for the typical
responsibilities expected of an executive holding such positions and such other
responsibilities consistent with such positions as may be assigned to the
Executive from time to time by the Chief Executive Officer of the Company.

                                   SECTION III
                                TERMS AND DUTIES

A.   PERIOD OF EMPLOYMENT

     The term of Executive's employment under this Agreement will commence as of
     July 16, 2001, and shall continue through December 31, 2001, subject to
     extension or termination as provided in this Agreement (the "Period of
     Employment"). The term shall be extended for an additional one-year period
     as of December 31, 2001 and as of each December 31 thereafter, unless
     either party gives ninety (90) days prior notice of its intent not to
     extend.

B.   DUTIES

     During the Period of Employment, the Executive shall devote all of his
     business time, attention and skill to the business and affairs of the
     Company and its subsidiaries. The Executive may (i) participate in the
     affairs of any governmental, educational or other charitable institution,
     or engage in professional speaking and writing activities, so long as the
     Chief Executive Officer does not determine, in good faith, that such
     activities unreasonably interfere with the business of the Company or
     diminish the Executive's obligations under the Agreement; or (ii) serve as
     a member of the board of directors of other corporations, so long as the
     Board of Directors of the Company, in its discretion, specifically approves
     such service, and in any such case, the Executive shall be entitled to
     retain all fees, royalties and other compensation derived from such
     activities in addition to the compensation and other benefits payable to
     him under the Agreement; and provided further, that the Executive may
     invest his personal or family funds in any form or manner he may choose
     that will not require any services on his part in the operation of or the
     affairs of the companies in which such investments are made. The Executive
     will perform faithfully the duties consistent with his position as
     President--Field Operations, which may be assigned to him from time to time
     by the Chief Executive Officer.

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                                   SECTION IV
                            COMPENSATION AND BENEFITS

A.   BASE SALARY

     During the Period of Employment, the Company agrees to pay the Executive a
     base salary ("Base Salary") of no less than Two Hundred and Fifty Thousand
     Dollars ($250,000). Such Base Salary shall be payable according to the
     customary payroll practices of the Company but in no event less frequently
     than bi-weekly installments. The Executive may be eligible for base salary
     increases as indicated by performance and/or market justification, solely
     at the discretion of the Chief Executive Officer and as approved by the
     Board of Directors.

B.   ANNUAL INCENTIVE AWARDS

     The Executive will be eligible for annual incentive compensation awards
     during the Period of Employment. Executive incentive plans and individual
     eligibility for participation are specifically approved by the Board of
     Directors of the Company according to and defined by the Company's normal
     executive compensation programs.

     Without limiting the foregoing, the Executive shall receive a guaranteed
     minimum annual incentive compensation award of $125,000 for each of (i) the
     balance of 2001 and (ii) fiscal year 2002. The Executive shall be eligible
     to receive an additional incentive compensation award of $50,000-$75,000
     for fiscal year 2002, based solely upon satisfaction of certain performance
     goals established by the Board following the effective date of this
     Agreement, and paid in semi-annual increments over the course of 2002.

C.   OPTIONS

     Options that may be granted to the Executive before or during this period
     of employment shall be governed by the terms and provisions comparable to
     those applicable to options granted under the Company's Stock Option Plan.
     Notwithstanding the foregoing, if (i) the Period of Employment ends because
     the Company ends the automatic extension thereof under Section III A. of
     this Agreement; (ii) the Company terminates the employment of the Executive
     Without Cause as defined in Section VIII; (iii) the Executive's employment
     hereunder terminates because of his death or disability (as defined in
     Section VI); or (iv) there is a change in control of the Company, such
     options shall become fully exercisable and shall remain exercisable for the
     remainder of their term.

     For purposes of this Agreement, a "change in control" of the Company shall
     be deemed to occur in connection with any of the following events with
     respect to the Company;

          (i)  The acquisition by an entity, person or group (including all
               affiliates of such entity, person or group) of beneficial
               ownership, as that term is defined in Rule 13d-3 under the
               Securities Exchange Act of 1934 (which definition shall apply
               even if the Company is not then subject to such Act), of capital
               stock of the Company entitled to exercise more than 30% of the
               outstanding voting power of all capital stock of the Company
               ("Voting Stock");

          (ii) The effective time of (i) a merger or consolidation of the
               Company with one or more other corporations as a result of which
               the holders of the outstanding Voting Stock immediately prior to
               such merger or consolidation (other than the surviving or
               resulting corporation or any affiliate thereof) hold less than
               50% of the Voting Stock of the surviving or resulting
               corporation, or (ii) a transfer of more than 50% (in value) of
               the assets of the Company other than to a transferee in which the
               Company owns at least 50% of the Voting Stock; or

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          (iii) The election to the Board of Directors of the Company of the
                lesser of (i) three directors or (ii) directors constituting a
                majority of the number of directors of the Company then in
                office, without the recommendation of the existing Board of
                Directors.

D.   OFFICE AND RELOCATION

          For fourteen months following the effective date of this Agreement, or
          such shorter time as the Executive shall determine, in his sole
          discretion, Executive shall be based at an office in the Alpharetta,
          Georgia area.

          The Company shall reimburse the Executive for (i) all reasonable
          expenses incurred in packing and moving Executive's personal and
          professional property from Alpharetta, Georgia to the Barrington,
          Illinois area, and (ii) all reasonable real closing costs paid by
          Executive in connection with the sale of his residence in Georgia and
          the purchase of his residence in Illinois (such as real estate
          commissions, recording taxes, attorney's fees, other title examination
          fees, lender's title insurance, appraisal fees, inspection fees,
          survey fees, and out-of-pocket costs with respect to obtaining a first
          mortgage, such as underwriting, application, and origination fees);
          provided, that the Company shall not reimburse Executive for any such
          costs which represent down-payment, pre-payment, pro-ration, escrow,
          or reimbursement for prior payment by others of regular and ongoing
          expenses associated with owning a home, including, but not limited to,
          mortgage principal, mortgage interest (including loan discounts),
          homeowner's insurance, mortgage insurance, property taxes, property
          management fees, and dues or fees for homeowners' or other related
          associations.

          The Company shall pay, or shall reimburse Executive for, all
          reasonable expenses incurred by Executive and Executive's spouse for
          travel between Alpharetta, Georgia, and Barrington, Illinois, for up
          to two house-hunting trips during such period (which reimbursement
          shall be separate from expenses for Executive's business travel during
          such period, as provided in Section V).

          The amounts paid or reimbursed pursuant to this subsection shall be
          "grossed-up" to include federal, state, and local income taxes payable
          by Executive with respect to such payment or reimbursement.

E.   ADDITIONAL BENEFITS

          The Executive will be entitled to participate in all compensation or
          employee benefit plans or programs and receive all benefits and
          perquisites for which any salaried executive employees are eligible
          under any existing or future plan or program established by the
          Company for salaried executive employees. The Executive will
          participate to the extent permissible under the terms and provisions
          of such plans or programs in accordance with plan or program
          provisions. These may include group hospitalization, health, dental
          care, life or other insurance, tax qualified pension, savings, thrift
          and profit sharing plans, termination pay programs, sick leave plans,
          travel or accident insurance, short and long term disability insurance
          and contingent compensation plans including capital accumulation
          programs, restricted stock programs, stock purchase programs and stock
          options plans. Nothing in this Agreement will preclude the Company
          from amending or terminating any of the plans or programs applicable
          to salaried executive employees of the Company. Notwithstanding the
          foregoing sentence, no such amendment or termination shall reduce or
          otherwise adversely affect Executive's rights under Section IV C. of
          this Agreement. In addition to the foregoing benefits, Executive shall
          be entitled to a paid vacation of four (4) weeks during each twelve
          (12) month period during the Period of Employment.

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                                    SECTION V
                                BUSINESS EXPENSES

     The Company will reimburse the Executive for all reasonable travel and
other expenses incurred by the Executive in connection with the performance of
his duties and responsibilities under this Agreement which shall specifically
include such expenses incurred by Executive for business travel between
Alpharetta, Georgia, and Barrington, Illinois, during the period that the
Executive is based in Alpharetta, Georgia pursuant to Section IV E.

     Executive must support all expenditures with customary receipts and expense
reports subject to review by the Company.

                                   SECTION VI
                                   DISABILITY

A.   PAYMENTS

     Executive's employment hereunder may be terminated by the Company if (i)
     Executive becomes physically or mentally incapacitated, (ii) is unable for
     a period of one hundred eighty (180) consecutive days to perform his
     material duties and responsibilities and (iii) a determination is made
     regarding Executive's continued incapacity by a physician appointed by the
     Company (such continued incapacity is hereinafter referred to as
     "disability"). Upon any such termination for disability, Executive shall be
     entitled to receive (i) his Base Salary, as well as the annual incentive
     award, prorated in each case through the date on which the Executive is
     first eligible to receive payment of long term disability benefits in lieu
     of Base Salary under the Company's long term disability benefit plan as
     then in effect covering the Executive, and (ii) his accrued benefits under
     the terms of the plans, policies and procedures of the Company.

B.   ASSISTANCE TO THE COMPANY

     During the period the Executive is receiving payments of either regular
     compensation or disability insurance benefits described in this Agreement
     and as long as he is physically and mentally able to do so, the Executive
     will furnish information and assistance to the Company and from time to
     time will make himself available to the Company with respect to area and
     matters in which he was involved during his employment with the Company.

                                   SECTION VII
                                      DEATH

     In the event of the death of the Executive during the Period of Employment,
(i) Executive's estate shall be entitled to receive his Base Salary, as well as
the annual incentive award, prorated in each case through that date of
Executive's death, and (ii) Executive's designated beneficiary or estate, as the
case may be, shall be entitled to his accrued benefits, including, but not limit
to, life insurance proceeds, under the terms of the plans, policies and
procedures of the Company.

                                  SECTION VIII
                       EFFECT OF TERMINATION OF EMPLOYMENT

A.   TERMINATION WITHOUT CAUSE

     If the Company terminates Executive's employment Without Cause during the
     Period of Employment, as defined in this Agreement, or the Period of
     Employment ends because the Company ends the automatic extension thereof
     under Section III A. of this Agreement, the Company will pay to the
     Executive in a lump sum, his Base Salary for a period of twelve (12)
     months. Earned but unpaid Base

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     Salary will be paid in a lump sum at the time of such termination. The
     Company also will pay the Executive in a lump sum upon such termination an
     amount equal to the prorated portion of the annual incentive award for the
     year in which the termination occurred. The benefits and perquisites
     described in this Agreement as in effect at the date of termination of
     employment will be continued for the then remaining Period of Employment.

B.   TERMINATION WITH CAUSE

     If the Company terminates Executive With Cause, (i) Executive shall be
     entitled to receive his Base Salary prorated through the date of the
     Executive's termination, and (ii) Executive shall be entitled to his
     accrued benefits under the terms of the plans, policies and procedures of
     the Company.

C.   EFFECT OF CERTAIN TERMINATIONS

     Upon termination of the Executive's employment for reasons other than due
     to death, disability or pursuant to Paragraph A of this Section, or upon
     Executive's resignation, the Period of Employment and the Company's
     obligation to make payments under this Agreement will cease as of the date
     of termination except as expressly defined in this Agreement. Executive
     shall have the right to voluntarily terminate this Agreement, other than
     for Good Reason or in conjunction with a Change in Control, upon two weeks'
     prior notice to the Company. If Executive voluntarily terminates his
     employment with the Company, (i) Executive shall be entitled to receive his
     Base Salary prorated through the date of Executive's voluntary termination,
     and (ii) Executive shall be entitled to his accrued benefits under the
     terms of the plans, policies and procedures of the Company.

D.   DEFINITIONS

     For this Agreement, the following terms have the following meanings:
          (1)  Company's Chief Executive Officer acting in good faith by written
               notice by the Company to the Executive specifying the event
               relied upon for such termination, due to the Executive's serious,
               willful misconduct with respect to his duties under this
               Agreement, including, but not limited to, conviction for a felony
               or perpetration of a common law fraud, which has resulted or is
               likely to result in material economic damage to the Company.
          (2)  Termination "Without Cause" means termination by the Company of
               the Executive's employment other than due to death, disability,
               or termination With Cause.

                                   SECTION IX
     OTHER DUTIES OF THE EXECUTIVE DURING AND AFTER THE PERIOD OF EMPLOYMENT

A.   COOPERATION DURING AND AFTER EMPLOYMENT

     The Executive will, with reasonable notice during or after the Period of
     Employment, furnish information as may be in his possession and cooperate
     with the Company as may reasonably be requested in connection with any
     claims or legal actions in which the Company is or may become a party.

B.   CONFIDENTIAL INFORMATION

     The Executive recognizes and acknowledges that all information pertaining
     to the affairs, business, clients, customers or other relationships of the
     Company, as hereinafter defined, is confidential and is a unique and
     valuable asset of the Company Access to and knowledge of this information
     are essential to the performance of the Executive's duties under this
     Agreement. The Executive will not during the Period of Employment or after,
     except to the extent reasonably necessary in performance of the duties
     under this

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     Agreement, give to any person, firm, association, corporation or
     governmental agency any information concerning the affairs, business,
     clients, customers or other relationships of the Company, except as
     required by law. The Executive will not make use of this type of
     information for his own purposes or for the benefit of any person or
     organization other than the Company. The Executive will also use his best
     efforts to prevent the disclosure of this information by others. All
     records, memoranda, etc. relating to the business of the Company, whether
     made by the Executive or otherwise coming into his possession are
     confidential and will remain the property of the Company.

C.   CERTAIN RESTRICTED ACTIVITIES

     During the Period of Employment and for a one (1) year period thereafter,
     the Executive will not use his status with the Company to obtain goods or
     services from another organization other than in the ordinary course of
     business. During the Period of Employment and for a one (1) year period
     following termination of the Period of Employment: the Executive will not
     make any statements or perform any acts intended to advance the interest of
     any existing or prospective competitors of the Company in any way that will
     injure the interest of the Company; the Executive, without prior express
     written approval by the Board of Directors of the Company, will not
     directly or indirectly own or hold any proprietary interest in or be
     employed by or receive compensation from any party engaged in the same or
     any similar business in the same geographic areas the Company does
     business; and the Executive, without express prior written approval from
     the Board of Directors, will not solicit any members of the then current
     customers, clients or suppliers of the Company or discuss with any employee
     of the Company information or operation of any business intended to compete
     with the Company. For the purposes of the Agreement, proprietary interest
     means legal or equitable ownership, whether through stock holdings or
     otherwise of a debt or equity interest (including options, warrants, rights
     and convertible interest) in a business firm or entity, or ownership of
     more than 2% of any class of equity interest in a publicly-held company.
     The Executive acknowledges that the covenants contained herein are
     reasonable as to geographic and temporal scope. For a twelve (12) month
     period after termination of the Period of Employment for any reason, the
     Executive will not hire any employee of the Company or solicit, other than
     by means of a general solicitation to the public such as a newspaper
     advertisement, or encourage any such employee to leave the employ of the
     Company.

D.   REMEDIES

     The Executive acknowledges that his breach or threatened or attempted
     breach of any provision of Section IX would cause irreparable harm to the
     Company not compensable in monetary damages and that the Company shall be
     entitled, in addition to all other applicable remedies, to a temporary and
     permanent injunction and a decree for specific performance of the terms of
     Section IX without being required to prove damages or furnish any bond or
     other security. The Executive hereby acknowledges the necessity of
     protection against the competition of, and certain other possible adverse
     actions by, the Executive and that the nature and scope of such protection
     has been carefully considered by the parties. The period provided and the
     area covered are expressly represented and agreed to be fair, reasonable
     and necessary. If, however, any court or arbitrator determines that the
     restrictions described herein are not reasonable, the court or arbitration
     panel may modify, rewrite or interpret such restrictions to include as much
     of their nature and scope as will render them enforceable.

                                    SECTION X
                           INDEMNIFICATION, LITIGATION

A.   CORPORATE INDEMNIFICATION AND INSURANCE

     The Company will indemnify the Executive to the fullest extent permitted by
     the laws of the Company whichever affords the greater protection to the
     Executive. The Company will use its best efforts to obtain and maintain
     customary directors and officer liability insurance, covering Executive.
     The foregoing

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     indemnification shall continue to apply following termination of the Period
     of Employment for actions or omissions during the Period of Employment.

B.   LIMITED INDEMNIFICATION FOR BREACH OF COVENANTS

     During the Period of Employment, the Company will indemnify the Executive
     against any and all obligations to pay a judgment, settlement, penalty,
     fine, or reasonable expenses (including, without limitation, counsel fees
     and retainers, court or arbitration costs, transcript costs, fees of
     experts or witnesses, travel expenses, and all other disbursements or
     expenses of the types customarily incurred in connection with prosecuting,
     defending, preparing to prosecute or defend, being prepared to be a witness
     in, or otherwise participating in a proceeding (as defined below),
     including any appeals), actually incurred with respect to any threatened,
     pending, or completed action, suit, or other proceeding, whether civil,
     criminal, adminstrative, arbitrative, or investigative (a "proceeding"), to
     which the Executive is a party by reason of any alleged breach of
     restrictive covenant or violation of the terms or conditions of employment,
     written or oral, between Executive and his former employer, alleged to
     arise from Executive's execution of this Agreement or performance of his
     obligations hereunder. Notwithstanding the foregoing, in no event shall the
     Company's aggregate indemnification obligation pursuant to this Section X B
     exceed twenty five thousand dollars ($25,000.00).

                                   SECTION XI
                                WITHHOLDING TAXES

     The Company may directly or indirectly withhold from any payments under
this Agreement all federal, state, city or other taxes that shall be required
pursuant to any law or governmental regulation.

                                   SECTION XII
                           EFFECT OF PRIOR AGREEMENTS

     This Agreement contains the entire understanding between the Company and
the Executive with respect to the subject matter and supersedes any prior
employment, severance, or other similar agreements between the Company, its
predecessors and its affiliates, and the Executive.

                                  SECTION XIII
                                  MODIFICATION

     Subject to Section IV G., this Agreement may not be modified or amended
except in writing signed by the parties. No term or condition of this Agreement
will be deemed to have been waived, except in writing by the party charged with
waiver. A waiver shall operate only as to the specific term or condition waived
and will not constitute a waiver for the future or act on anything other than
that which is specifically waived.

                                   SECTION XIV
                           GOVERNING LAW; ARBITRATION

     This Agreement and its validity, interpretation, performance and
enforcement shall be governed by the laws of the State of Illinois, without
giving effect to the choice of law provisions thereof. Any dispute among the
parties hereto shall be settled by arbitration in accordance with the then
applicable rules of the American Arbitration Association and judgment upon the
award rendered may be entered in any court having jurisdiction thereof.

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                                   SECTION XV
                                     NOTICES

     All notices, requests, consents and other communications hereunder shall be
in writing and shall be deemed to have been made when delivered or mailed
first-class postage prepaid by registered mail, return receipt requested, or
when delivered if by hand, overnight delivery services or confirmed facsimile
transmission to the following:

          (a)  If to the Company, at:
               Alternative Resources Corporation 600 Hart Road, Suite 300
               Barrington,Illinois 60010
               Attention: Chairperson, Governance Committee of Board of
               Directors
               Or at such other address as may have been furnished to the
               Executive by the Company in writing, or
          (b)  If to the Executive, at:
               215 Beacon Knoll Drive Alpharetta, GA 30022
          Or such other address as may have been furnished to the Company by the
          Executive in writing.

                                   SECTION XVI
                                BINDING AGREEMENT

This Agreement shall be binding on the parties' successors, heirs and assigns.

                                  SECTION XVII
                                  MISCELLANEOUS

A.   MULTIPLE COUNTERPARTS

     This Agreement may be executed simultaneously in multiple counterparts each
     of the same force and effect.

B.   SEVERABILITY

     If any phrase, clause or provision of this Agreement is declared invalid or
     unenforceable by an arbitrator or court of competent jurisdiction, such
     phrase, clause or provision shall be deemed severed from this Agreement,
     but will not affect any other provisions of this Agreement, which shall
     otherwise remain in full force and effect. In addition, there will be
     automatically substituted herein for such severed phrase clause or
     provision a phrase, clause or provision as similar as possible, which is
     valid and enforceable.

C.   HEADINGS

     The headings and subheadings of this Agreement are inserted for convenience
     of reference only and are not to be considered in construction of the
     provisions hereof.

D.   CONSTRUCTION

     The Company and the Executive acknowledge that this Agreement was the
     result of arm's-length negotiations between sophisticated parties each with
     full opportunity to consult with and be represented by legal counsel. Each
     and every provision of this Agreement shall be construed as though both
     parties participated equally in the drafting of same, and any rule of
     construction that a document shall be construed against the drafting party
     shall not be applicable to this Agreement.

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E.   SURVIVORSHIP

     The provisions of Sections IV-XVII shall survive the termination or
     expiration of this Agreement.

IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the date
first above written.

                                       COMPANY
                                       ALTERNATIVE RESOUCES CORPORATION

                                       BY:--------------------------------------
                                       Raymond R. Hipp, Chief Executive Officer

                                         and
                                       EXECUTIVE
                                       BY:--------------------------------------
                                        Miner Smith

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