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OC Employment Firms Decline 1% in Revenue

Orange Countyโ€™s largest employment agencies outpaced their national counterparts in 2023, though not enough to see a year-over-year gain in business.

The areaโ€™s top 15 agencies reported $594 million in total revenue last year, a decline of about 1% year-over-year.

It couldโ€™ve been worse; revenue for employment agencies in the U.S. last year declined an estimated 10% to $201.7 billion, according to a report from Staffing Industry Analysts (SIA).

2022 marked a record year for the industry, SIA reports.

The SIA report cites factors such as labor hoarding and a shrinking number of remote work positions to blame for last yearโ€™s industrywide decrease.

SIA predicts that the U.S. industry will return to growing in 2024, with increases in sectors such as engineering and education.

Staffing agencies are often seen as a bellwether for the job market, as companies tap their services to fill positions ranging from industrial to administrative, before making permanent hires.

Orange Countyโ€™s unemployment stood at 4.2% in January, the highest level in two years.
That figure is up from a revised 3.8% in December and above the 3.4% rate seen in January last year, according to data this month from the stateโ€™s Employment Development Department.

The stateโ€™s unemployment rate was 5.7% in January while the U.S.โ€™s was 4.1%.

20K Placements

The modest drop in 2023 revenue for OCโ€™s agencies follows steady growth in recent years, with an 11% jump in 2022 and a 1.7% increase in 2021.

OC employment agencies underwent three years of declines prior to 2021, when companies suffered labor losses from the pandemic.

This yearโ€™s Business Journal Employment Agencies list includes 15 firms ranked by OC revenue.

Staffing agencies said they placed 20,543 temporary workers at OC firms last year, down 4.7% from 2022.

The number of permanent workers similarly decreased 14% to 678, a drop from the 28% increase the prior year.

Of the ranked agencies, five reported an increase, four reported a decline and the remaining six were Business Journal estimates.

Top 3 Firms

One thing that remained unchanged from last year was the three largest staffing firms topping the list.

Atlanta-based Employbridge, formerly known as Select Staffing, retained its No. 1 position.

The firm, which operates locally in Irvine, saw OC revenue decrease 12% to $88.1 million.

Employbridge last month posted highlights from the Bureau Labor Statistics which reported that the U.S. economy added 275,000 jobs in February, about 9% above analystsโ€™ predictions. This unexpected gain was attributed to a spike in healthcare services, transportation and warehousing and food service jobs.

Orange-based Roth Staffing Cos. LP, the second largest on the list, reported an 8.8% decrease to $74.3 million.

Roth Staffing is the largest employment agency based in OC with 156 employees locally.

โ€œMany industries and companies experienced over hiring in 2021 and 2022, contributing to fluctuations in the market,โ€ Roth Staffingโ€™s Chief Executive Adam Roth told the Business Journal.

Completing the top three is Tustin-based PriorityWorkforce Inc., which reported a 3% increase in revenue to $65 million.

Job Demand

For the second year in a row, Irvine-based Pacific Companies Inc. saw the largest local revenue increase.

The firm, which specializes in healthcare placements, reported a 35% increase in revenue to $46 million.

The largest decrease in local revenue came from Irvine-based Express Employment Professionals, down 21% to $17.2 million, moving it down one slot to No. 12 on the list.

โ€œ2022 sales were the companyโ€™s highest on record, and 2023 was just a slight decrease,โ€ William Dunn, franchise developer and owner at Express Employment, told the Business Journal.

โ€œAs the economy continues to recover from the pandemic, conditions in 2023 were simply different than the year before.โ€

Industries seeing the most demand and growth in OC include jobs in healthcare, manufacturing and hospitality, according to Dunn.

He said staffing agencies both locally and nationally are currently experiencing a transitional phase during the backdrop of an election.

โ€œOur predominant sector, historically characterized by evaluation hire, is presently witnessing a shift towards temporary arrangements,โ€ Dunn said.

The firm anticipates a roughly 4% payroll increase in OC for this year driven by a shortage of talent creating a competitive landscape for employers.

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