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VOL. 118 | NO. 212 | Monday, November 22, 2004

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Temp Market Grows With Regional Economy


The Daily News

News about Memphis ongoing market for temporary workers has traveled so far that an intern for a Comedy Central television show recently called the Memphis Regional Chamber to ask about it.

Larry Henson, vice president of research and information technology for the chamber, said the cable station was producing a show about nighttime workers, and the intern wanted to know if Henson could add some information from a local perspective.

Government statistics on the citys temporary employment market are incomplete, Henson said, in part because of the way workers are classified. Companies often report their number of full-time equivalent workers based on the number of hours worked, not by the literal number of employees, he said.

King of part-time. But the citys status as a distribution hub also makes it a hub for temporary and seasonal workers, an employment sector that has seen recent growth as the nations economy shows cautious signs of improvement.

As Henson told the Comedy Central caller: Memphis is the king of night-time and part-time work.

Joel Myers, principal at The Centre Group, said many local companies are currently using temporary workers to make up between 30 percent and 50 percent of their staff. Henson believes the nature of distribution operations in Memphis is a driving force behind the trend, pointing to the thousands of part-time workers attracted to jobs at FedEx alone. That doesnt come as a surprise, as 2003 figures from the Tennessee Department of Labor and Workforce Development show that the distribution sector employs the largest percentage of Shelby Countys work force.

Its pretty phenomenal, Henson said, FedEx is the all-time king of part-time people, but thats just a function of the window they have.

Rapid growth. Because much of the information about the citys temporary job market is anecdotal and because Memphis is such a massive distribution hub there are varying views on the trend. Several analysts, including Henson and Dr. John Gnuschke, director of the Sparks Bureau of Business and Economic Research at the University of Memphis, said evidence indicates that Memphis temporary job market is growing rapidly.

Gnuschke, in particular, believes the markets growth reflects the general resurgence taking place in the local and national economy. And with the holiday season fast approaching, Henson said local employers are currently bringing on a new flood of temporary workers.

We have kind of an extra component to our seasonal holiday rush and crunch for temporary employment over and above what most cities would experience, Henson said. And we have some pretty unique companies in terms of seasonality and temporary situations in logistics. Companies like (gift wrap manufacturer) Cleo are very seasonal, and FedEx has a surge because of Christmas.

Williams-Sonoma has a very high peak because of Christmas, and theyre here because of FedEx and because of our logistics advantages.

Holiday surge. And Myers said the presence of a large number of catalog and mail-order operations adds to that holiday surge in temporary employment. Williams-Sonoma, he explained, will probably double its work force during the holidays and add a large number of temporary workers to deal with catalog orders.

On a national level, the trend is much the same temporary workers are becoming increasingly attractive to employers looking for more effective ways to manage their operations. According to the National Association of Temporary and Staffing Services, 2.5 million temporary and contract workers were employed each day in second quarter 2004, up almost 16 percent from the same period last year. Second quarter sales from temporary help topped $15.8 billion in the quarter, up almost 14 percent from the same period in 2003.

Cautious expansion. Gnuschke said employers are weathering the hesitant economic resurgence by slowly adding temporary workers to their staffs.

As the economy has expanded, I think the temporary employee market has expanded, and thats because employers have been really apprehensive about taking on permanent, full-time employees given kind of the uncertainty of this recovery, he said.

Henson said companies are turning to temporary workers for flexibility, because many just dont need a large number of full-time employees. But with the future of TennCare hanging in the balance, Gnuschke pointed to an offshoot of the trend that could spell trouble for those workers an increased demand for social services.

Few temporary employees are provided any kind of fringe benefits like health insurance, and consequently, they fall into the public arena and increase the cost of TennCare, Gnuschke said.

Broad impact. In the meantime, analysts said the large pool of temporary workers in Memphis will remain a powerful force in the local economy.

The use of (temporary workers) is a good idea on the part of employers who are seeking to minimize labor costs and, in some cases, maximize profits, Gnuschke said. In the short run, and I think many employers think in the short run, temporary employees provide employers a great service.


PROPERTY SALES 51 328 20,960
MORTGAGES 58 387 24,132
BUILDING PERMITS 170 842 43,435
BANKRUPTCIES 50 288 13,468