2022 US Staffing Industry in Review
2022 was an unprecedented year for US Staffing Industry with growth hitting a record high of $212 billion according to Staffing Industry Analysts, surpassing initial projections by 13%.
As reported by Statista by the end of 2027 almost 50% of the workforce in the US is expected to be contingent. This comes as no surprise as many of PGC’s international recruitment clients operating in the US staffing have witnessed extreme growth within the temporary staffing segment within the past year, across the multiple sectors in which they operate.
With further growth expected in the US staffing industry in 2023, we thought it would be important to recap the trends we have witnessed in 2022.
Top Temporary Sectors in the US Staffing Industry in 2022
IT and Tech Sector
The IT and tech temporary staffing sector in the US was predicted to grow by 16%, to reach a projected value to reach $41.7 billion in 2022, according to SIA. To put the enormous profit making opportunity into perspective, the entire UK recruitment market is only worth $51 billion!
IT and tech is the second-largest driver of the US economy, and the North American tech sector controls 35% of the global market. So if you’re an international recruiter who hasn’t yet considered making placements in the US, why not try tech?
With PGC’s employer of record solution you can start making contract placements in any state without a US entity. Some of the best states for tech in 2022 included Texas, followed by California and Illinois. You can read more in our Top 5 Fastest-Growing USA Tech Hubs blog.
Finance and Accounting Sector
Projected to account for $9.3 billion of US staffing revenue in 2022 by SIA, the finance and accounting temporary staffing sector is expected to grown year on year by 12%. If you plan on sourcing contractors in the finance and accounting sector in the US staffing market, you can source highly skilled talent from world class universities in the US, such as Harvard. Additionally, top US states in terms of temporary staffing market size in the finance industry include California and Florida
Life Science Sector
As 2022 comes to an end, the temporary life science market in the US is expected to account for $3.7 billion of the US staffing industry, with over 98,700 new jobs projected for the next decade according to SIA.
Top states in the US staffing industry for Life Science according to SIA's 'US Geographical Atlas 2022', include California generating over $803 million in revenue, followed closely by New Jersey and Massachusetts.
Marketing and Creative Sector
The marketing and creative temporary segment of the US staffing industry in 2022 continued to experience strong growth, to total a projected $14.3 billion, a 12% year on year growth from 2021. The top areas for marketing and creative contract placements in the US staffing market included California, New York and Texas, according to SIA research.
Top Locations for Recruiting in the US Staffing Market
When entering the US staffing market, it is important to treat each US state like an individual country. This is due to each state having its own set of legislation, taxes and employment laws which differ on a federal, state, and local level. According to ASA, the top 5 states with highest staffing revenue are California, Texas, New York, Florida and Illinois.
Highest Staffing Revenue Per State (ASA)
Growing States for Contract Placements by PGC’s Recruitment Clients
At PGC, our internal data has also proved Texas and Florida are states that are growing in the US Staffing Market in 2022. According to our internal data, Texas moved ahead of New York as our second most popular state for contract placements by our recruitment clients operating in the US staffing market in 2022. Florida and North Carolina also made tractions to move up to fourth and fifth for states for most contract onboards in 2022.
We also witnessed a 12% increase last year in contract placements in Illinois. Additionally, an up-and-coming state in the US staffing market in 2022 for our clients was Tennessee, which experienced a 26% increase in contractors placed in 2022 compared to 2021 – the highest growth rate for any state in the US In 2022.
Employment Growth in the US Staffing Industry
Employment growth within the US has been ever growing in most recent years and shows no signs of stagnation with over 263,000 jobs added in November 2022, continuing from the gains in both October, and September, according to the US labor department. The unemployment rate remained at 3.7%, close to a 50-year low.
Manufacturing, professional business services, health care and social assistance have accounted for 47% of US employment growth this year and are four categories continuing to grow in the US staffing market according to the SIA.
Changes to Employment in the US Staffing Market
Pay Transparency
A major change to the US staffing market in 2022 is the increasing prominence of pay transparency laws. If you are recruiting within the US staffing market, should you advertise a job post in certain states you will need to display a minimum and a maximum salary range on every job post.
Currently California and Colorado require pay transparency with New York joining in November 2022. States potentially heading towards this change are Washington, Massachusetts and South Carolina, so it’s important to do your research and remain compliant with US employment laws per state.
US Overtime Exemption Salary Threshold Updates
US employees must be paid a minimum salary of $684 weekly, or $35,568 annually, to be classified as exempt from overtime, with limited exceptions, under the federal Fair Labor Standards Act. An increased salary threshold or white-collar exemptions has been hinted by the Biden administration, but no proposal has been published in writing yet. In the meantime, Alaska, California, Colorado, Maine, New York, and Washington have adjusted their minimum exemption salary thresholds, which is worth noting if you plan on recruiting in the US staffing market. You can find out these states' minimum exemption salary thresholds and other important updates in our US Employment Law 2023 blog.
Projections for the US Staffing Industry in 2023
In 2023, the US staffing industry is expected by SIA to grow by a further 2% and will continue to reign the title of the biggest staffing market in the world. For 2023, the US staffing industry is set to grow further but at a much more moderate rate, with the temporary staffing market set to be worth $891 billion and place and search expected to contribute $25.6 billion to the overall revenue according to SIA. Download our free US staffing industry 2023 trends report to find out more.
Looking back on the history of the US staffing industry, and with the market surpassing initial projections by 13% early in 2022 we expect these projections to continue an upward traction beyond 2023.
If you’re a recruiter, there is no better time to enter the US staffing industry, to find out industry specifics relevant to your business objectives and how to get started, speak to one of our friendly US Expansion experts.