Staffing Stats

The latest labor market data continues to paint a mixed but increasingly interesting picture for staffing agencies. After three full years of decline, the industry is finally experiencing a (slow) recovery in 2026. Contract staffing employment is increasing at a rate of 1.3% in Q3, with projected growth of 2% in Q4. Employers are announcing more hiring plans than they were a year ago. At the same time, actual hiring remains uneven and labor force participation continues to decline. For staffing agency owners, this may be less about waiting for the overall market to improve and more about identifying where demand is emerging and positioning your agency to capitalize on it.

Contract Staffing Employment

According to the American Staffing Association, the Staffing Index jumped to a value of 93, with staffing jobs up 5.4% year-to-year, averaged over the four weeks ending 8/23/2026.

The staffing index is reported nine days after each workweek, making it a near real-time measure of staffing employment trends.  

Lay Off Data

According to a report released Sept 2^nd from global outplacement and executive coaching firm Challenger, Gray & Christmas, US based employers announced 52,881 job cuts in August, up 58% from the 33,429 cuts announced in July. However, this number is down 38% from the 85,979 layoff plans announced the same month last year. As a matter of fact, it marks the lowest August total since 2022.

“What we’d like to see with low layoffs is an increase in hiring activity. While companies are making plans to hire more workers than last year, according to our numbers, it doesn’t appear those positions are being filled quickly,” said Andy Challenger, workplace expert and chief revenue officer for Challenger, Gray & Christmas. 

Hiring Plans

Employers announced plans to hire 12,325 workers in August, down 23% from the 16,095 plans announced in July, and up 725% from the 1,494 announced in August 2025. It’s the highest August total since 2022, when employers announced 41,985 hiring plans. 

Aerospace/Defense led all industries in August with 4,025 announced hired, followed by Technology with 2,520. 

Employers are making plans to add workers, with 46% of those plans coming from manufacturing industries. “The questions are: How long will it take employers to actually fill these roles, and will they find workers with the requisite skills,” said Challenger. 

Click here for the full Challenger Report

Jobs Added

According to the Bureau of Labor Statistics, the US economy added 162,000 jobs in the month of August. This was 4 times what most economists projected and led heavily by healthcare, hospitality and government jobs. Meanwhile, ADP reported that US private employers added 38,000 jobs. Why the difference? 

They each use different data sources, scope, and survey methodology. BLS calculates the data using government jobs while ADP tracks only private-sector businesses. The BLS uses actual payroll numbers to estimate total payroll, and they conduct heavy statistical modeling while ADP tracks a subset of its own clients aggregated and anonymized payrolls and weights the data to match the broader economy.   

Labor Data

According to TED – The Economics Daily dated August 2026, current key US Labor Data stats include:

• US Unemployment Rate: remains unchanged at 4.1%
• Job Openings: 7.27 million
• Average Hourly Earnings: Increased to $37.75 per hour from $37.60
• Remote Work:  35% of people work remotely at least some of the time. 

Labor Force Participation

Labor force participation is at 61.6%, well below its all-time peak of 67.3% in January 2000. Over the last 2 decades there has been structural decline due to demographic shifts. BLS Chart

What This Means for Your Staffing Agency

There are some encouraging signs in this month’s data. The ASA Staffing Index has climbed to 93 and staffing employment is up.  

Employers still appear hesitant to move quickly from planning to hire to actually filling positions. That gap can create an opportunity for staffing firms. 

Agencies who are able to focus their business development efforts on industries showing demand, help clients identify hard-to-find talent, and coach employers on the need to efficiently move candidates through the interview process, will be well positioned for the remainder of 2026.

5 things staffing agency owners can do this month:

1. Revisit clients who put hiring on hold.  Rather than simply asking whether they have openings, lead with information and then ask what has changed in their workforce plans and as they look at Q4, where do they anticipate needing help.
2. Target Industries where hiring activity is showing strength. Healthcare (even non-clinical) as well as aerospace/defense manufacturing as well as technology led August’s announced hiring plans.
3. Sell your ability to shorten time-to-fill. Challenger, Gray, & Christmas specifically points to the disconnect between employers planning to hire and actually filling jobs quickly.  Make this a sales conversation. “What’s keeping your open positions from being filled?”  If it’s recruiting bandwidth, candidate availability, or lack of specialized skills, demonstrate how your agency can help solve the problem. 
4. Take another look at your candidate database. With labor force participation rate at 61.6%, finding available workers remains an important part of the equation. Re-engage candidates you haven’t spoken with recently, update availability and skills and identify people you can proactively market to clients.  
5. Build your Q4 prospect list now. Don’t wait for employers to officially open reqs. Identify 20-25 target companies in your strongest markets, research where they may be growing and begin conversations about their year-end and 2027 workforce plans.  In an uneven market, getting into the conversation before the job is open can give your staffing agency the edge.