Industrial staffing represents the largest occupational segment in the temporary staffing market, comprising 36% of the global market in 2016. SIA projects the US industrial temporary staffing segment (which represents 50% of the global market) will see a moderate 2% compound annual growth rate over the next two years.
Despite the moderate growth, this segment faces a number of pressures. Tighter US immigration trends and the growing problem of drug abuse, which disqualifies potential candidates, have all contributed to candidate scarcity. For example, the abuse of opioid painkiller medications without a prescription is estimated to involve 12 million Americans, according to the latest government survey.
These pressures are exacerbated in the US by a low unemployment rate for high school graduates with no college degree (a proxy for the supply pool for industrial staffing). In November 2017 it was 4.3%, down from 11.0% in March 2010. The smaller supply of candidates presents a challenge for industrial staffing firms to fill orders, creating a headwind to revenue growth.
Many businesses rely on the availability of industrial staff. By share of US market, the industries affected are reflected in the accompanying chart.
Manufacturing, the largest industry represented by industrial temporary staffing, accounted for 38% of the US temporary industrial staffing market in 2016.
The transportation and warehousing industry accounted for 15% share of the market. Employment growth in the warehousing and storage industry has been robust due to the rise of e-commerce and new logistics infrastructure for faster deliveries. Demand for truck drivers continues to be strong based on record tonnage and a shortage of drivers.
Other buyers of industrial staffing include the mining and oil and gas sector, the hospitality sector, and the waste management and janitorial industries.