US staffing industry revenue will shrink by 3% this year to a total of $184.6 billion, according to a new report by SIA. Helping drive the decline is travel nurse revenue, which continues to normalize after its pandemic highs. Travel nurse revenue is expected to decrease by 20% for this year. Excluding travel nurse and per diem nurse revenue, overall staffing industry revenue is expected to be roughly flat year over year with a contraction of just 0.3%.
In comparison, the staffing industry is estimated to have declined by 15% in 2023.
One explanation for the industry’s growth trajectory is that the US staffing industry is normalizing after the extraordinary upticks in 2021 and 2022 brought on by government spending in response to the pandemic, according to the report. Travel nursing grew sixfold between 2019 and 2022 amid Covid-19. Other explanations include higher pay rates reducing client demand and sectors with high usage of temps, such as manufacturing, seeing difficulty in the economy.
Looking at the revenue forecast by segment, SIA expects industrial staffing revenue to fall 5% this year, while office/clerical will hold steady. IT staffing revenue is expected to fall 3%.
There were bright spots in other segments. Education temporary staffing is expected to grow by 7% this year, and engineering staffing is expected to grow by 6%.
Looking forward to 2025, SIA forecast US staffing industry revenue will grow 3% to $189.9 billion. SIA believes the commercial segments will return to growth in 2025, while most professional segments other than healthcare will experience a mid-single-digit expansion.
Corporate members of SIA can download the full report, US Staffing Industry Forecast: March 2024 Update.
California’s minimum wage for fast food workers rose to $20 per hour today, NPR reported. The state’s minimum wage for jobs outside fast food remains $16 per hour, although it’s higher in certain areas. Still, employers paying under $20 per hour may face stiffer competition for workers, NPR noted.
The US manufacturing sector expanded in March for the first time since September 2022, the Institute for Supply Management reported today.
Its Manufacturing PMI composite index rose to a reading of 50.3% in March, up from February’s reading of 47.8%. Readings above 50% indicate the manufacturing sector is, generally, expanding.
“Business activity is up,” according to a quote included in the ISM’s report from an executive at a wood products manufacturer. “Many manufacturers are anticipating better business in the second quarter and much better in the third quarter. They are reporting that second-quarter bookings are just starting to ramp up.”
Another executive at a transportation equipment manufacturer said they are “expecting to see orders and production pick up for the second quarter. Suppliers are working with us to help drive costs down, which will help improve the margin for the rest of the year and deliver growth in 2025.”
However, the employment index, which makes up part of the overall Manufacturing PMI composite index, showed a contraction with a reading of 47.4% in March. It’s the sixth month of contraction for the employment index. The ISM noted companies are continuing to reduce staff through layoffs, attrition, and hiring freezes. Still, March’s reading is an improvement from 45.9% in February.
Data in the ISM’s report is based on a survey of purchasing supply executives across the US.