Record 5-Month Increase in Temporary Workers
From today's BLS employment report:
1) Manufacturing overtime hours decreased slightly to 3.4 hours in February from 3.5 hours in January, which was the highest level since August 2008 (see graph). This marks the first decline in overtime hours following ten straight months that overtime hours either increased or stayed the same as the previous month, which followed 16 months of declines (or no change) in average overtime hours. Despite the February decrease of .10 hours, overtime hours are still 26% above the level last February of 2.7 hours.
2) The number of temporary help workers increased in February by 47,500 to 2,008,700 employees, the highest level since December 2008 (see graph above). The February increase follows similar recent monthly increases of 50,200 in January and 49,700 in December. Temporary workers increased in February for the fifth straight month - the first time since 2005 of five consecutive monthly increases. The 284,000 increase in temporary jobs since the September-low is the largest 5-month increase since this data series started in 1990.
As I reported on Tuesday, The American Staffing Association's Staffing Index increased almost 11% this week from a year ago, the highest annual increase in three years. That 11% increase marked the 13th consecutive week of positive (or flat) increases in the ASA Staffing Index compared to the same week in the previous year, following 80 consecutive weeks of decreases from May 2008 through mid-November 2009.
The fifth monthly increase in Temporary Help Workers according to the BLS, along with similar recent improvements in the ASA Staffing Index, provide evidence that the labor market is gradually improving. In these early stages of economic recovery, employers remain cautious in their hiring decisions, and use temporary workers initially to meet the higher demand for their products. Hopefully, as the economic rebound gathers greater momentum in the coming months and employers become more confident about a continued expansion, they'll start hiring permanent workers.
Update: See "Surprisingly Strong Job Figures" by Floyd Norris in the NY Times.