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From the WSJ:

Demand for temporary and contract employees increased “markedly” this month, according to the American Staffing Association, a potential augur of improvement in the overall jobs picture.

The group’s Staffing Index rose to 75 in the two weeks ending Aug. 16, from 71 in early July, outpacing gains in the same period last year. The index, which measures demand for temporary workers among ASA member firms on a 100-point scale, has been hovering between 71 and 73 since hitting an all-time low of 69 at the end of December. The ASA says its members generate 85% of sales in the U.S. temporary-staffing industry.

A sustained rebound in temporary staffing levels could bode well for the overall labor market. Temp staffing is often a leading indicator of overall employment because cautious employers are more likely to add temporary workers before hiring full-time staff following a recession.

The rebound hasn’t shown up in data from the Labor Department’s Bureau of Labor Statistics, which lags the Staffing Index. Employment in temporary help services edged down by less than 1% to 1.74 million jobs in July, according to the BLS. The industry has shed 844,000 jobs since the recession began, but “the declines have lessened substantially over the past 3 months,” the BLS said in its latest employment report. Overall job loss in the U.S. slowed in July as the economy shed 247,000 jobs, and the unemployment rate fell slightly to 9.4 percent.

Temp work is highly volatile, but has tended to move in tandem with economic recoveries of the past.  The trend in employment might actually be making steady improvement though it’s doing so at an awfully tepid pace…..The slow recovery thesis is still on the table.

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