Staffing suppliers are partners in your mission to provide your organization with the right talent at the right time and the right price, so it is important to keep abreast of the challenges and opportunities they face face so you can better navigate these often complex relationships.
Published every two months, SIA’s “US Staffing Industry Pulse Survey Report” provides contingent workforce buyers with insights into their suppliers’ environment, how it affects their programs and what they should prepare for.
“This report helps to inform contingent workforce buyers,” says Matt Norton, workforce solutions research director at Staffing Industry Analysts. “Being an educated buyer is an absolute benefit to your organization and your CW program and can help you educate internal stakeholders on market trends or challenges. The report illustrates that recruiting difficulty is easing slightly while the pace of bill rate growth is also slowing. While both may be positive indicators for program managers, they should be placed in a wider context as the labor market remains tight from a historical perspective.”
Provider Landscape
Significant loosening of labor market. Average sales difficulty increased to 3.34 in May’s survey from 3.10 in March’s report (on a scale of 1 to 5), while average recruiting difficulty decreased to 3.07 from 3.21. Historically, sales difficulty has been higher than recruiting difficulty, but for the first and only time since the beginning of the pandemic, the recruiting difficulty was higher than sales difficulty in May’s survey. Travel nurse staffing providers reported the highest recruiting difficulty at 3.36.
New orders. The survey featured in the “May 2023 Selected Highlights” report found a net decrease of 32% in new orders in the last three months, down from a net decrease of 27% reported in the previous survey for the March report and its lowest historical value aside from the outset of the pandemic in 2020. And while a net 19% of staffing firms surveyed for May’s report still expect an increasing trend in the next six months, this is also down when compared to the 41% who expected an increasing trend in the previous survey.
Bill rates. The survey also provides some insight into bill rates. A net 2% of staffing firms reported an increasing trend in bill rates over the last three months, down from 5% in the prior survey; in addition, the net percentage of staffing firms expecting an increasing trend in the next six months fell to 5% in the May report from 21% in March.
Revenue. Overall, temporary staffing revenue fell by a median 2% year over year among staffing firms taking part in the May Pulse survey, a slight improvement from a 3% decrease noted by participants in the March report; however, the aggregate decrease in their US temporary staffing revenue was 10% in the May survey, continuing the trend seen in March of larger companies reporting more negative growth than smaller companies reported.
Locum tenens again posted the strongest median revenue growth at 11%; allied healthcare and finance/accounting also reported annual growth at 5% and 1%, respectively. On the flip side, the travel nurse staffing segment reported a 21% decline, and per diem nursing fell 6%.
Impact of AI
The May Pulse survey also queried participants about how they expected the incorporation of artificial intelligence to affect their firms’ staffing levels over the next three years. In all, 23% of respondents expect that AI will lead to reduced staffing levels at their firm in the next three years, much outweighed by the 62% expecting AI to have a neutral impact on staffing levels. Meanwhile, 15% reported they expect AI to actually increase staffing levels.
By primary industry served, 27% of healthcare staffing firms expect reduced staffing levels due to AI, compared to 19% of manufacturing staffing firms.
Among all staffing segments, the finance/insurance segment had the highest expectation for increased staffing levels at 25%, although 75% expect a neutral impact.
The survey for SIA’s May Pulse Report included responses from 183 staffing firms that conduct business in the US. Selected highlights of the May 2023 Pulse Report are available for download to CWS Council members.
