The key factor that is increasing need to employ temporary labor to overcome labor shortages due to covid-19 is boosting the global Temporary Labor Market.
Covid-19 impact and market status
The temporary labor market has faced challenges as well as gained traction in during the cobvid-19 pandemic. The pandemic has led to the closure of operations for various sectors such as manufacturing, construction, and mining among others. The social distancing regulations and increasing focus on curbing the spread of the virus have led to migration of labor, which has affected the market growth.
Unemployment due to covid-19 and other factors have led to shortage of both skilled and unskilled labor thereby making easy availability of labors.
The lockdown has also seen large sections of the workforce being made redundant, displaced, furloughed, and for the self-employed, unable to run their business. Many of these workers have sought temporary work outside of their skillset to make a living and have entered the gig economy to take up temporary appointment.
Manufacturing and service enterprises estimated to propel the growth of the market
Manufacturing and service providing enterprises are hiring managers on a temporary basis to understand and organize the company’s present operations scenario in order to improve productivity and efficiency. This is estimated to propel the growth of the management sector. To align the company’s services and products with the changing demands of customers, more and more manufacturing firms are appointing skilled workforce on a temporary period. This is expected to propel the temporary labor market growth at a wider level in the forecast years.
Increasing demand for temporary healthcare labor will increase
Increasing base of older population and the prevalence of many diseases are leading to an increased demand for trained healthcare professionals such as nurses, who are capable of working for a temporary period to provide quality medical care to the patients. Increasing covid-19 cases across the world, medical emergencies, aging population, diagnostic centers is increasing the demand for temporary labor which are the key factors for growth of healthcare segment in global temporary labor market.
APAC region to record highest growth in CAGR during the forecast period
Booming automotive industry increasing the demand for temporary labor is the key factor for substantial growth of European region in temporary labor market. It is estimated that the growth will continue as there is an increase in the number of small and medium enterprises (SMEs) in this region. These SMEs prefer appointing temporary workers so that they can reduce hiring costs.
Asia Pacific region is estimated to record growth during the forecast period. Governments in this region are making continuous efforts to launch various healthcare programs that will lead to the increase in demand for temporary healthcare staff, thereby propelling the growth of the market further.
The benefits of HR cost savings, and savings on employee training cost is expected to further propel the global temporary labor market.
The global temporary labor market is expected to register a CAGR of 6.4% from 2018-2028. The market has been growing steadily because various industries such as construction, logistics, telecommunications, healthcare, and information technology (IT), have been appointing temporary workers on their expansion projects on a regular basis. Increasing smart city projects is expected to increase labor demand which is anticipated to be a key growth factor of global temporary labor market.
The global temporary labor market size is estimated to grow USD 673.45 billion by 2028, registering a CAGR of 6.4% from 2018 to 2028.
Organizations experience several benefits of opting to temporary labor such as low hiring cost, savings on employee training, ability to deploy labors to non-core tasks, or core tasks. Thus such benefits is encouraging further adoption of temporary labor services.
The clerical segment of the temporary labor market held the largest market share of approximately 60.0%. Various industries such as manufacturing, real estate, insurance, and retail, prefer appointing experienced clerical workers for a temporary period for small assignments and for various roles. Temporary labor roles primarily include, typist, office clerk, computer operators, etc.
Temporary labor has a variety of advantages such as lowering the hiring and training costs. Temporary labor is readily available, because of which businesses can appoint it for non-essential jobs while they devote their own resources to core jobs required. Such benefits are estimated to help the industries flourish. Lack of labor is common in businesses, especially during peak periods and crunch times. During such times, businesses often look to appoint temporary labor services. Due to increasing need for semi-skilled or skilled employee in various sectors the focus on temporary labor is growing.
Temporary labors are usually hired to replace aging infrastructure, retail outlets, e-commerce companies to home-delivery of goods and products. Most importantly, temporary labor compensates labor shortages and is greatly hired by organizations top handle additional project pressure or during peak time periods. These factors are expected to propel the global temporary labor market.
One of the major drawbacks of hiring temporary workers is that it often leads to instilling a sense of insecurity among the permanent employees and demoralizes them affecting labor productivity and growth of the organization. Another drawback that is lack of customer satisfaction due to insufficient skills of temporary labor and minimal experience level is another key factors likely to hamper the temporary labor market growth. Additionally, increasing automation jobs and growth in robotics & artificial intelligence could lead to automation of jobs which will reduce the number of employment opportunities for majority of blue-collar temporary workers. Adoption of such technologies could result in replacement of temporary labor for cost savings and addressing efficiencies.
The major players in global temporary labor market are Persol, Robert Half International, Westaff, Express Services, Hays, Randstad N.V., ManpowerGroup, Kelly Services, Allegis, and Adecco among others. The companies for market sustenance, expansion, and increasing competitiveness in local and global markets are launching new products, collaborating, and merging with other industry players.
Recent innovations in the temporary labor market: A Snapshot
- For instance, in March 2018, ManpowerGroup Inc. introduced a platform called IntelliReach for Managed Service Provider (MSP) TAPFIN. The platform helps in digitizing management tools and include supplier scorecards and data warehousing, which helps organizations to make better workforce decisions.
- For instance, in September 2017, Adecco acquired BioBridges, LLC, a life science profession staffing company, to expand its professional staffing services and offerings for the biotechnology, pharmaceuticals, and medical devices industries.
Temporary Labor Market Scope
|Forecast Unit||Value (USD)|
|Revenue forecast in 2028||USD 673.45 billion|
|Growth Rate||CAGR of 6.4 % during 2021-2028|
|Segment Covered||Type, End Use, Regions|
|Regions Covered||North America, Europe, Asia Pacific, Middle East and Africa, South America|
|Key Players Profiled||Persol, Robert Half International, Westaff, Express Services, Hays, Randstad N.V., ManpowerGroup, Kelly Services, Allegis, and Adecco among others.|
Key segments of the Temporary Labor Market
Type Overview, 2018-2028 (USD Billion)
End Use Overview, 2018-2028 (USD Billion)
- FMCG and retail
- Logistics and Telecom
Regional Overview, 2018-2028 (USD Billion)
- North America
- Asia Pacific
- Middle East & Africa (MEA)
- North America