Throughout 2012, U.S. employers used all kinds of temporary labor, such as freelancers, contract workers, temps, staffing companies and other workers that weren't given the title of permanent employee.
Now, IQNdex has issued a report that details the impact this evolution has had on the hiring environment, and made special note of the rising costs of outsourcing temporary workers.
"Temporary workers are a leading indicator for where the economy is heading because U.S. companies increasingly rely on this type of labor to ramp up their growth plans," said John F. Martin, CEO of International Markets and Chief Product Officer. "IQNdex provides invaluable information for anyone who wants to understand trends in the labor market, including company executives, economists, HR professionals and managers responsible for services procurement."
There were several major takeaways from the report, however the most notable may have been the analysis of billing rates throughout the country. According to the study, billing rates for temp workers and contingent employees jumped 2.7 points in the index in 2012. This rate was even higher than the inflation rate for this period, and the increase in temporary labor costs came even as the unemployment rate dropped from 8.5 percent to 7.8 percent - a 0.7 percent decline.
What's more, the report pegs billing rates for temp workers to continue to rise, which could lead to higher demand for flexible labor based more on performance and cost per unit labor pricing rather than hourly temps. Given the steady growth in the IQNdex last year and the lower unemployment rate, the report expects temporary labor rates to rise further in 2013.
Hourly rates for workers in the IT sector rose 5.1 percent last year, while professional-managerial rates surpassed the inflation rate.
According to Staffing Industry Analysts, this is clearly reflected in the growth rate of the temp hiring sector, which has been decelerating for three years.