Staffing agencies throughout the Wilmington region have found growth in the economic downturn. As companies slowly begin to crawl out from the enormity of the financial meltdown, many prefer to add contract workers opposed to full-time employees.

“Employers are reticent to hire for fear of legislative uncertainty,” said Mike Youngblood, who owns Youngblood Staffing in Wilmington with his wife Sandra.  Youngblood has seen a significant rise in the contract staffing portion of his business. “Employers don’t know what their expenses are going to be.  They are uncertain about unemployment, health care, family medical leave and unionizing rules.”

For an uncertain employer, staffing agencies can fill a great need.  Rather than hire employees and bear the responsibility of benefits and potential unemployment taxes, an employer can retain workers from an agency like Youngblood Staffing.  The worker, a Youngblood employee, is then contracted to the employer that needs the labor.  Youngblood collects a fee from the employer but retains all the responsibility to pay the employee’s salary and benefits and offer vacation days and federal and state unemployment taxes for the worker.

“Hiring a contract worker is like saying, ‘Let’s put our foot in the water rather than jump in,’” Youngblood said. “Contract is the fastest-growing business segment and I don’t see that changing.”

At The Wilmington Group, contract staffing business is also booming. “We’ve seen a 400 percent increase in our business, and I attribute it mostly to contract employees,” said Kirk Sears, CEO of The Wilmington Group.

For years The Wilmington Group’s business focused primarily on executive search, now that has changed. “We’ve taken the initiative to shift to the contract side,” Sears said. “Forecasts show predictions for contract labor to grow to 25 percent of labor in 2015.”

The Wilmington Group is having success in contract staffing in the IT, health care and engineering fields. According to Sears, the IT sector has exploded both regionally and nationally for contract labor.

The Wilmington Group is not abandoning executive search, Sears insists. The company is merely expanding its business. One local business that remains focused on executive search is Human Capital Solutions.

Bo Burch, Chief Principal at Human Capitol Solutions, is cognizant of the spike in contract staffing though has not added that component to his business services. Human Capital has instead added executive coaching and career advancement solutions.

Burch said with many mid-management types stalled in a position or between opportunities, there is a need for individuals to “optimize their employment package.” Burch sees the executive coaching and career advancement solutions markets as areas loaded with growth potential for his company. “Our services significantly improve probability for landing a job you want and getting the compensation you seek,” Burch said.

Standard staffing firms and executive search firms have changed in lockstep with the national economy. This has mostly come out of necessity.

“We are very excited about the contract business, it is a big part of our future,” Sears said. “But if I weren’t in this business, I’d be worried about it.”

Youngblood is happy his business is increasing, though he also fears the larger picture.  “We’re getting a bigger share of a declining market.  Eventually that’s a problem.”

Sandra Youngblood added, “Our business is up, absolutely. We’re riding a wave but we’re not quite sure where it’s going to take us.”
The type of work staffing agencies fill also is evolving. In previous years this meant a lot of administrative and entry-level work. That has shifted to more lucrative contract jobs commanding $50,000 or more annually.

“The button-pusher jobs have left. It’s knowledge-based now,” Mike Youngblood said.

As the economy remains volatile, Wilmington area staffing agencies expect continued success. Contract workers will be the driving force. “(Contract workers) are not less expensive,” Sears said. “But they allow employers more flexibility.”