The U.S. staffing industry has experienced a rough two years due to certain job segments that underperformed.
The decrease was reflected in Orange County, where staffing agencies saw revenue decline 2.4% to $571 million. Nationwide, revenue for employment agencies declined an estimated 10% to $189 billion, according to a 2024 annual report from Staffing Industry Analysts (SIA).
This year’s Business Journal list of employment agencies includes 14 companies ranked by 2024 OC revenue.
Growth has slowed in the past two years since agencies boosted revenue by 11% to $597 million in 2022, which was a record year for U.S. employment agencies. Last year, the segments that performed worse than expected were nurse staffing, engineering, life sciences and direct hiring.
“Especially in contrast to the boom times of 2021-2022, the U.S. staffing industry has had a tough stretch over the past two years, as most segments have experienced an unrelenting decline,” the SIA report said.
While revenue remained down, the number of job placements increased across the board.
Staffing agencies said they placed 27,608 temporary workers at OC firms last year, up 2% from 2023.
The number of permanent workers surged 22% to 9,530, rebounding from the 14% loss seen in the prior year.
Top Three Firms Decrease in Revenue
Decreases were seen among the three largest staffing firms in OCÂÂÂÂÂÂÂÂ. The largest decrease on the list came from Atlanta-based Employbridge, which operates locally in Irvine.
It still retained its No. 1 position but saw revenue decrease 17% to $73.4 million.
“The overall staffing industry experienced declines last year, reflective of general economic/market conditions,” a spokesperson told the Business Journal.
Employbridge, the largest industrial staffing firm in the U.S., has placed more than 400,000 people at companies in 48 states to date. Last month, it named Geof Held as chief product officer.
“We’re excited about seeing the impact of his leadership as we apply technological solutions to reduce friction and accelerate growth for our clients, talent and employees,” Chief Executive Billy Milam said in a statement.
Orange-based Roth Staffing Cos. LP, No. 2 on the list, reported a 10% decrease to $66.9 million. The private firm counts 162 employees.
Roth Staffing said it saw increased demand for talent in artificial intelligence and manufacturing of medical devices. It’s forecasting a “slower but steady growth rate” for employment in 2025, led by remote and hybrid work models.
“Remote and hybrid work models, plus employee retention strategies, are shaping the workforce as companies try to attract candidates in new ways,” James Sense, regional vice president at Roth Staffing, told the Business Journal.
Rounding out the top three is PriorityWorkforce Inc. in Tustin, which saw local revenue drop 3% to $63 million.
Need for More Contract Workers
Irvine-based Pacific Companies saw the largest local revenue increase for the third year in a row.
The firm, which specializes in healthcare placements, reported a 19% increase to $54.7 million. A big driver of the increase was the “success and expansion” of the company’s locum tenens business, CEO Gary Cook said, referring to the temporary placement of physicians and other providers.
Pacific Companies’ number of temporary employees placed at OC firms increased 14% to 125.
“By focusing on providing exceptional service to both healthcare systems and providers, we’ve been able to meet a growing demand for flexible staffing solutions, which has directly contributed to this impressive growth,” Cook told the Business Journal.
Pacific Companies was one of four companies to report a revenue increase. Five reported declines and the remaining five were Business Journal estimates.
Some attributed the decline to “broader economic trends impacting hiring across multiple industries,” said Kelli Maresch, partner at Brentwood-based staffing firm Vaco, which has an office in Irvine.
It reported a revenue increase of 7% to $17 million, ranking No. 11 on the list.
“Many companies have taken a more cautious approach to permanent hiring, prioritizing strategic hires over volume-based recruitment,” Maresch told the Business Journal.
She said that temporary placements have also experienced a slight decline but remain crucial to companies that need talent to fill immediate needs.
Hot job sectors in OC include technology, manufacturing and financial services with a need for more contract professionals in accounting and finance, according to Maresch.
