Consider the following:
- Amazon.com uses a temp agency to hire warehouse people and put them through a probationary period.
- My friend Gary with three-dozen employees also uses a temp agency for the same reason.
- Seattle just passed a phased-in $15 an hour minimum wage and there are minimum wage increases coming to many cities and states.
Do you think that employers are going to be fussier about who they hire and that person’s productivity? If an employee is expected to move/make/pack 100 units an hour for $10 an hour will employers expect them to do 150 an hour for $15? I think so.
I also expect there will be fewer permanent hires making their way through the temp agency system. The long-term burden of hiring someone (who doesn’t perform) is too high, so employers will look even closer at reducing that risk.
My opinion is that temp agencies are going to see an uptick in business because of this and employees at the entry and just-above-entry level are going to have to build their skills (learn how to be a good employee) more than ever and prove themselves. If I was in or advising to the temp agency industry I would be putting together a marketing plan to make screening services available to businesses that hire people at these wage rates.
“Never think you’ve seen the last of anything.” Eudora Weity