Labor Forecast Predicts 5.6% Decrease in Demand for Temporary Workers in 2023 Fourth Quarter

— Industry Consulting Firm G. Palmer & Associates’ Quarterly Forecast

Assists in Previewing Near-Term Hiring Patterns –


NEWPORT BEACH, CA – (NewMediaWire) – October 27, 2023 – Demand for temporary workers in the United States is expected to decrease 5.6% on a seasonally adjusted basis for the 2023 fourth quarter, when compared with the same period in 2022, according to the Palmer Forecast™, released today. Demand for temporary workers has been softening since the fourth quarter of 2022.


The Palmer Forecast™ indicated a 4.3% decrease in temporary help for the 2023 third quarter. Actual results as reported by the Bureau of Labor Statistics (BLS) decreased by 5.5%, reflecting GDP growth below expectations.


A total of 9.61 million open jobs were reported by the BLS through August 2023, an increase of 690,000 jobs over July and 710,000 jobs more than consensus forecasts.


The BLS reported that temp help jobs decreased by 4,200 in September 2023, a reduction of 5.5% year-over-year. Through September 2023, an average of 10,500 temp jobs per month have been lost, compared with a decline of 30,000 temp jobs in all of 2022, or an average of 2,500 temp jobs lost per month. Temp help jobs growth in 2021 was strong, with a total gain of 302,000 jobs, and an average of 25,200 jobs added per month, compared with the prior two years, when 201,000 temp jobs were lost in 2020, and 27,000 temp jobs were lost in 2019, according to the BLS. In 2018, more than 99,000 temp help jobs were added over 2017.


The Labor Department reported that non-farm payroll employment increased by 336,000 jobs in September 2023, which was substantially greater than consensus estimates of 163,000 jobs. The three-month moving jobs average increased to 266,000 from 189,000 in September vs. August. For the 2022 full year, there were 4.5 million jobs added, an average of 375,000 jobs per month. In 2021, non-farm employment was up by 6.4 million jobs, compared with 2020. To put this in perspective, there were 9.4 million jobs lost in 2020, and 2.1 million total jobs added for 2019. For 2018, a total of 2.6 million new jobs were created, vs. 2.1 million new jobs in 2017.


The key categories of jobs created in September are as follows:


       Total Non-Farm: +336,000

       Private Sector: +236,000

       Leisure and Hospitality: +96,000

       Government: +73,000

       Private Education and Healthcare: +70,000

       Transportation: + 9,000

       Temp Help: -4,200


In September 2023, the labor participation rate was at 62.8%, equal to that of August 2023, and it has been in a narrow range of 64.4% to 61.9% since June of 2020. The U3, commonly referred to as the unemployment rate, was flat at 3.8%, in September vs. August.


As reported by the BLS, the rate of unemployment for workers with college degrees in September 2023 decreased 10 bps to 2.1%, from August 2023. The unemployment rate for workers with less than a high school education increased 10 bps to 5.5%. The U6 unemployment rate, which tracks those who are unemployed, as well as those who are underemployed and are working part-time for economic reasons, was down 10 bps to 7.0% in September versus August. The U6 rate is considered the rate that most broadly depicts those most affected by the last economic downturn and measures the rate of discouraged workers.


“The temporary help employment market is showing further signs of slowing down. Until GDP growth resumes to a stronger level and interest rates stabilize and begin to trend down, growth will be nonexistent, and temp help will continue to soften,” said Greg Palmer, founder and managing director of G. Palmer & Associates, an Orange County, California-based human capital advisory firm that specializes in workforce solutions. “A further indicator to watch is the temp help penetration rate, because it measures temp help as a percentage of total employment. In September 2023, the temp help penetration rate decreased slightly to 1.88% of the total labor market, compared with an all-time high of 2.08%, achieved in February 2022, and a pre-pandemic level of 1.57%.


“The penetration rate cycle last peaked at 2.05% in December 2015 and was at a low of 1.3% in June 2009. The American Staffing Association (ASA) Staffing Index decreased by 0.1%, to a rounded value of 100 on October 15, 2023, which was 7.2% lower than the same period last year,” Palmer added.


About the Palmer Forecast™

The Palmer Forecast™ is based, in part, on BLS and other key indicators. The model was initially developed by the A. Gary Anderson Center for Economic Research at Chapman University and serves as an indicator of economic activity. Companies that employ temporary staff use the forecast as a guide to navigate through fluctuating economic conditions in managing their workforce to meet business demands.


About G. Palmer & Associates

G. Palmer & Associates, founded in 2006, provides advisory services in the human capital sector. Founder Greg Palmer has served on the board of the American Staffing Association and was president and chief executive officer of RemedyTemp, Inc., one of the nation’s largest temporary staffing companies, prior to its sale in June 2006. For more information, visit


Roger Pondel/Judy Lin                                                  

PondelWilkinson Inc.   

Philip Boronow, Analyst
G. Palmer & Associates


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