6

B. Occupations in the

Temporary Help Services

Industry

Patrick Kilcoyne

Patrick Kilcoyne is an economist in the Division of Occupational

Employment Statistics, Bureau of Labor Statistics.

The employment services industry, which includes temporary help services, has grown dramatically over thepast few years. The number of employees nationwide in employment services grew 6.3 percent from 3,254,700

in May 2003 to 3,461,200 in May 2004, and employment in

temporary help services grew 9.2 percent from 2,184,100 to

2,385,000.1

 These growth rates were faster than the overall

employment growth of 1.2 percent over the same period, and

the 200,900 new jobs in the temporary help industry constituted 13.0 percent of all job growth during those 12 months.

This article investigates the types of jobs and wage rates

found in these industries as compared with the national

economy.

Industry staffing

The temporary help services industry, which accounts for

roughly 70 percent of the workers in employment services,

comprises establishments primarily engaged in supplying

workers to client businesses for limited periods of time to

supplement the client workforce. For the purpose of providing paychecks, unemployment tax coverage, and any benefits to the temporary service workers, these workers are

considered employees of the temporary help services establishment, as are the permanent administrative workers of the

agency. Direct supervision of the workers often is provided

by the client business. Table B1, based on data from the

Occupational Employment Statistics (OES) survey, shows

the distribution of employment by occupation for this industry, in order of the largest temporary help occupations.2

 Not

surprisingly, lesser skilled or lower wage workers preponderate in this industry. For example, just three occupations—

laborers and hand material movers, general office clerks, and

hand packers and packagers—accounted for almost 30 percent of the temporary help workers in May 2004, although

they made up less than 5 percent of the national employment

total. Because the skills needed in these occupations are not

specialized, workers qualified for them can work in a variety

of companies and industries. What might surprise some is

the presence of higher skilled occupations, such as registered nurses and computer programmers. These are occupations in which knowledge and abilities, though considerable, are also transferable.

Chart B1 demonstrates the predominance of certain occupational groups in the temporary help services industry.

Office and administrative support, production, and transportation and material-moving workers appear in the temporary help industry in far greater proportions than they do in

the Nation as a whole. These groups of occupations generally require less training and specific knowledge and, consequently, are not typically high paying. Other occupations

that require minimal on-the-job training are less concentrated

in temporary help than in the United States as a whole. They

include sales and related workers and food service workers.

Workers in these occupations have a great deal of contact

with customers and are trained to act as representatives of

the employer instead of simply performing assigned duties.

Occupational groups such as management and legal occupations, which require more focused training and experience

than do other occupations, are employed in very low numbers in the temporary help services industry. Other occupational groups with a low employment share in the temporary

services industry, such as education or maintenance workers, may be subject to union agreements or regulations that

do not permit the employment of temporaries.

Wage differentials

Overall, wages in the employment services industry are lower

than in other industries. While the hourly median and mean

wage rates for the United States as a whole are $13.83 and

$17.80 respectively, the median and mean wage rates in employment services are $10.02 and $12.99. This is partly because of the predominance of low-paying occupations in

this industry, and partly because workers—even in better

paying occupations in this industry—earn less than their

1

 Bureau of Labor Statistics, Current Employment Statistics program, seasonally adjusted data. 2

 BLS does not publish estimates for the temporary help services

industry on a regular basis because the OES survey was not designed to

produce estimates at this level of detail. However, the sample size is

sufficiently large that estimates produced at the national level for this

industry provide valuable employment and wage information.

 B.
7

Table B1. Predominant occupations in the temporary help services industry, May 2004

All occupations ........................................................... 2,375,330 100.0 $12.53 –$5.27

Laborers and freight, stock, and material

 movers, hand ............................................................ 439,390 18.5 8.69 –1.84

Office clerks, general ................................................. 127,420 5.4 10.53 –1.09

Packers and packagers, hand ................................... 107,850 4.5 8.09 –.88

Team assemblers ........................................................ 103,470 4.4 9.68 –2.68

Production workers, all other ..................................... 77,660 3.3 9.66 –3.81

Helpers—production workers ................................... 72,020 3.0 8.41 –1.94

Customer service representatives ............................ 62,760 2.6 11.72 –2.29

Construction laborers ................................................. 53,970 2.3 9.27 –4.59

Packaging and filling machine operators and

 tenders ..................................................................... 51,640 2.2 8.96 –2.63

Secretaries, except legal, medical, and executive ... 47,730 2.0 12.39 –.67

Executive secretaries and administrative

 assistants .................................................................. 47,370 2.0 15.57 –2.12

Data entry keyers ....................................................... 45,010 1.9 10.80 –.92

Registered nurses ...................................................... 44,820 1.9 30.99 +4.93

Receptionists and information clerks ........................ 40,320 1.7 10.67 –.24

Assemblers and fabricators, all other....................... 38,380 1.6 9.48 –4.66

Office and administrative support workers,

 all other ...................................................................... 37,790 1.6 11.13 –2.03

Nursing aides, orderlies, and attendants .................. 36,130 1.5 11.64 +1.25

Janitors and cleaners, except maids and

 housekeeping cleaners ............................................ 30,750 1.3 8.40 –1.51

Licensed practical and licensed vocational nurses . 30,210 1.3 20.63 +3.88

Employment, recruitment, and placement

 specialists ................................................................. 28,750 1.2 21.80 –.96

Stock clerks and order fillers ..................................... 28,690 1.2 9.74 –.78

Inspectors, testers, sorters, samplers,

 and weighers ............................................................ 26,470 1.1 11.48 –3.52

Bookkeeping, accounting, and auditing clerks .......... 25,850 1.1 13.28 –1.06

Shipping, receiving, and traffic clerks ....................... 25,360 1.1 10.63 –1.80

All other information and record clerks ..................... 22,510 .9 13.13 –5.21

Farmworkers and laborers, crop, nursery,

 and greenhouse ....................................................... 21,150 .9 7.77 –.30

Industrial truck and tractor operators ........................ 20,450 .9 10.94 –2.63

Word processors and typists .................................... 18,890 .8 13.57 –.60

File clerks .................................................................... 18,550 .8 10.43 –.29

Business operations specialists, all other ................ 16,690 .7 20.93 –6.79

First-line supervisors/managers of office

 and administrative support workers ....................... 16,690 .7 17.95 –3.20

Truckdrivers, heavy and tractor-trailer ..................... 14,250 .6 14.73 –1.90

Cutting, punching, and press machine setters,

 operators, and tenders, metal and plastic .............. 14,130 .6 9.80 –3.24

General and operations managers ............................ 12,240 .5 39.83 –4.41

Refuse and recyclable material collectors ................ 12,170 .5 8.10 –5.27

Landscaping and groundskeeping workers ............. 11,940 .5 9.37 –1.25

Home health aides ...................................................... 11,840 .5 9.73 +.60

Carpenters .................................................................. 11,710 .5 14.98 –3.28

Telemarketers .............................................................. 11,230 .5 9.78 –1.51

Machinists ................................................................... 11,230 .5 12.50 –4.23

Computer support specialists .................................... 10,740 .5 19.33 –1.64

Maintenance and repair workers, general ................ 10,620 .4 12.90 –2.51

Mail clerks and mail machine operators,

 except postal service ............................................... 10,230 .4 9.81 –1.46

Construction and related workers, all other ............. 9,960 .4 8.15 –4.56

Truckdrivers, light or delivery services ..................... 9,120 .4 10.43 –2.45

Computer programmers .............................................. 8,890 .4 39.54 +7.85

Accountants and auditors ......................................... 8,240 .3 25.44 –1.91

Electrical and electronic equipment assemblers ....... 8,100 .3 10.38 –2.25

Difference from

national average

wage

Temp services

employment

Percent of temp

services

employment

Average

hourly wage Occupation
8

counterparts in other industries. The predominance of lowpaying occupations is probably a function of at least two

factors. First, lower paid occupations generally require less

training, facilitating short-term assignments and allowing

temporary agencies to place these workers easily. A second

factor is that employers wanting workers with higher skills or

more company-specific knowledge are likely to invest in hiring and training them on a permanent basis, instead of using

temporary workers.

In addition to hiring more workers in low-paying occupations, employers in this industry generally pay lower wages

to workers within each occupation, as shown in the wage

difference column of table B1. (National cross-industry wage

rates are shown separately in this publication.) The lower

wages may be due to the employers' reluctance to invest in

specific training for temporary workers, the reduced need to

pay a premium for these workers to reduce turnover, or the

fact that temporary workers do not typically gain any considerable seniority or experience at their jobs.

Nevertheless, in a few occupations workers earn considerably higher wages in the temporary services industry than

in the Nation as a whole. These occupations have different

characteristics than most in this industry. They are more

highly skilled, require more training, and have more customer

contact, in addition to having higher wages. The similarities

between them and other workers in this industry include the

portability of their skills, which tend not to be specific to a

particular company. For instance, registered nurses, who

make up 1.9 percent of all temporary workers, earn an average temporary wage that is $4.93 more per hour than the

national average for this occupation. Likewise, licensed practical nurses who work as temporaries earn $3.88 more per

hour than the national average. Because there is great demand for nurses in many areas of the country, temporary

workers who can be hired for a short time and yet possess

the essential qualifications of licensed nursing staff members earn a wage premium over their permanently employed

counterparts. Nursing aides, orderlies, and attendants and

home health aides also earn higher wages in temporary help

than do their counterparts in other industries. On average,

computer programmers earn a full $7.85 per hour higher in

the temporary help services industry than nationwide, possibly due to the flexibility of temporary programmers to complete computer projects for a client under a time constraint,

while not requiring the company to hire full-time workers

with salary and benefits.

A leading indicator?

There is some evidence that changes in employment in the

temporary help services industry are a bellwether of employment changes in the U.S. economy. Data published by the

Current Employment Statistics program demonstrate that

seasonally adjusted monthly payroll employment in the

United States steadily decreased from approximately 132.2

million in May 2001 to approximately 129.8 million in May

2003 and then began to increase gradually. Employment in

temporary help services showed a similar cycle, but preceded

the national trend by several months. Temporary help ser0 5 10 15 20 25 30

United States

Temporary help services

Management

Business and financial operations

Computer and mathematical

Architecture and engineering

Life, physical, and social science

Community and social services

Legal

Education, training, and library

Arts, design, entertainment, sports, and media

Healthcare practitioners and technical

Healthcare support

Protective service

Food preparation and serving related

Building and grounds cleaning and maintenance

Personal care and service

Sales and related

Office and administrative support

Farming, fishing, and forestry

Construction and extraction

Installation, maintenance, and repair

Production

Transportation and material moving

Major occupational group

Percent of employment

Chart B1. Employment distribution in the United States and in the temporary help services industry, 

 by major occupational group, May 2004
9

vices employment began to drop in November 2000 and continued until March 2003; then, employment in this industry

increased by 140,000 workers between April and November

2003. Some economists have suggested that, during a recession, temporary workers are the first to be laid off because

the separation costs of these workers are lower and that, in

the beginning stages of an economic recovery, these workers are the first to be hired because the fixed labor costs for

them, such as benefits and training, are less.

Recent changes in employment within the temporary help

services industry support the theory that this industry tends

to lead aggregate employment trends in the Nation. There

are many reasons for this, including corporate restructuring

and macroeconomic changes, but it is clear that employment

cycles in the temporary industry are much more volatile and

employment changes more dramatic. Still, jobs in this industry have increased at a much faster rate than overall employment over the past decade. From January 1995 to December

2004, total private employment in the United States increased

from 97.0 million to 110.8 million, an increase of 14.2 percent,

whereas total employment in temporary help services increased from 1.7 million to 2.5 million during the same period,

an increase of 42.9 percent. Therefore, as a growth industry,

temporary help services employment trends may “lead” as

well as outpace usual cyclical hiring spurts in the economy.

 Chart B2 displays the total employment for all private

industries, as well as the total temporary help services employment, from 1995 to 2004. These totals are based on the

same seasonally adjusted statistics previously cited. The

chart demonstrates that changes in temporary help services

employment almost always precede, or are concurrent with,

changes in total private industry employment. Further, because persons who are temporarily assigned in other industries are not included as part of the total employment within

those industries, it is likely that the temporary help services

industry is siphoning off some of the employment growth

generated by other industries. Over time, many of these

workers will become permanently employed in the client’s

industry, making temporary services a reasonable predictor

of occupational shifts in the economy. More research could

demonstrate whether occupational employment changes that

take place in the temporary help services industry are eventually reflected across other industries, and the extent of

these dynamics.

Chart B2. Temporary help services and total private employment, 1995—2004

94

96

98

100

102

104

106

108

110

112

114

1.7

1.8

1.9

2.0

2.1

2.2

2.3

2.4

2.5

2.6

2.7

Private employment Temporary help services

December 

1995

December 

1996

December 

1997

December 

1998

December 

1999

December 

2000

December 

2001

December 

2002

December 

2003

Total private 

employment 

in millions

Temporary 

help 

services 

employment 

in millions