DCR Trendline January 2013 – Contingent Worker Forecast and Supply Report

REPORT # 11 | January 2013

TRENDLINE
Contingent Worker Forecast and Supply Report

Inside this Issue
Note from the Editor
Note from the Editor 1
As we begin the New Year, our concentraƟon this month lies upon closing up 2012 by
DCR National Temp Wage Index 2 providing you a summary of the trends in temporary employment in 2012. TrendLine, this
month, provides you with acƟonable insights into the conƟngent staffing industry while
Year in Review: A Comparative Look
showcasing pivotal trending themes. With our ever-growing diverse range of sources, we
at the Temporary and Private
Employment Trends in 2012 3
analyze conƟngent worker supply and demand to bring you predicƟve forecasts of wage trends
and market standing.
Super Sectors over the Year 4
As always we start our ediƟon with the DCR NaƟonal Temp Wage Index, focusing
Online Job Growth 5 specifically on key forecasts for the first quarter of 2013. Our first feature arƟcle is a
highlightsoriented comparaƟve analysis of 2012 trends in both temporary and private
Service-Sector Hiring to Hit Four employment. Pay parƟcular aƩenƟon to the comparaƟve employment index graphs, and
Year High 6 our insighƞul conclusions regarding these categories. ConƟnuing our aƩenƟon to the
year past, we provide you with a breakdown of the employment in the super sectors over
Employment Projection in 2013 7
2012, including an analysis of one featured industry. We also follow-up our previous ediƟon
Focusing on Youth: Temporary arƟcles on online job searches with an analysis for Monster’s employment index of online job
Employment and Safeguards 10 posƟngs.

Unstructured Data Analysis: From We then shiŌ our focus to 2013 with a feature on hiring in the service sector (“Service
Mystery to Magic 12 Sector Hiring to Hit Four-Year High”), and follow this analysis with projecƟons for employment
trends in the upcoming year. Look out for our forecasted projecƟons on the largest industries
Methodology 14 to grow in terms of employment in the upcoming year. We conƟnue this secƟon with a special
piece on youth employment with specific analysis and advice for graduaƟng college students
References 14
searching for employment.

Our final piece this month explores the trend of unstructured data analysis. We discuss the
importance of using this valuable informaƟon, and the challenges companies face as they try to
solve the mystery of this intricate data source. This arƟcle also features an internal case study
“In the next 12 months, com- proving the value of unraveling the intricacies of unstructured complex data.

“
panies will re-imagine how
work gets done, who does it, On a concluding note, the DCR Market Intelligence Editorial Staff, along with the enƟre

complish the task. Workforce
changes that started during
tensify,
cluding offering more flexibil-
ity over where and when their
ver
people work, and relying on
more conƟngent and contract
workers” ~Workforc
workers” ~Workforce.com
“
“
and what tools they use to ac-

the recession will intensify, in-
recession
worker-base of DCR Workforce, would like to extend our wishes for a happy holiday season with
conƟnued peace, joy, and success in 2013!

Ammu Warrier
Ammu Warrier, President

Trend Line: ConƟngent Worker Forecast and Supply Report. © DCR. All Rights Reserved - 1

DCR National Temp Wage Index

During the start of the year, we expect to find temporary worker wages on the relaƟvely higher side, which could drop
slightly towards the end of the first quarter.

Forty-six percent of hiring managers and recruiters expect addiƟonal hiring during the first half of 2013 as compared
to the second half of 2012. Meanwhile, 44 percent of hiring managers and recruiters say that current economic
condiƟons are having no substanƟal impact on their hiring plans.

Low-wage industries like retail and hospitality are known to employ a high number of part-Ɵme workers and are
preparing for the largest increase in costs, with 46 percent saying they’re expecƟng costs to increase by a minimum of
3%. The health care industry is in a similar situaƟon, with 40 percent expecƟng that same increase in costs.

According to the Freelancers Union, nearly one in three American workers are freelancers,
contractors, or conƟngent workers. And 19 percent of them say that they have doubled
their income in the pas year.
ome past


Year in Review: A Comparative Look at the Temporary and Private Employment Trends in 2012

2012 was a strong year for temporary workers, as year-over-year, the number of temporary help jobs rose by
182,800 The United States added 18,000 Temp jobs in November with the jobless rate down to 7.7%. The temporary
penetraƟon rate rose to 1.91% in November from 1.90% in October.

Meanwhile, in private employment, college-level employment, which is considered similar to professional employment,
remained at 3.8% (the same as last month), which dropped in October by 0.3% compared to September’s 4.1%. Hurricane
Sandy also did not substanƟvly impact the naƟonal employment and unemployment esƟmates for November 2012.

Facts and Figures – A Comparison of Temporary and Private Workforce Trends
Trend Temporary Private
Number of months with a positive change in employment (Jan 2009 – Nov 2012): 36 14
Number of months with a negative change in employment (Jan 2009 – Nov 2012): 11 33
Total employment created in 2012 187,300 169,700
Average employment growth per month in 2012 17,027 154,272.70

Comparison in Employment Index (Jan 2009 to Nov 2012)
Comparing the indexes of both
categories of employment, it
is interesƟng to observe that
temporary employment, using
January 2010 as a reference point,
immediately began to rise, while
private employment only started
to see some improvement in May
2012.

Out of the 47 months from Jan
2009 to Nov 2012, temporary
employment has shown posiƟve
increment during 36 months,
whereas total private job has had a
posiƟve increment in employment Temporary Employment Index
for 33 months.

Finally, we really see the strength
of the temporary employments
with temporary jobs increasing
by 30.39 index points above the
reference, whereas private job
could only make .82 index points
above reference.

Private Employment Index


Super Sectors Over the Year
During the last year, Professional and Busi-
ness Services have shown a maximum
growth of 3.04 index points followed by Lei-
sure and Hospitality at 2.27 index points and
TransportaƟon and Warehousing by 2.09 in-
dex point.

Temporary Help Services falls as a part of
Professional and Business Services, which
has had a remarkable growth trend with a
higher change in index points than total pri-
vate jobs together. The sector also shows the
maximum months of posiƟve increment in
employment over the last four years.

Industries showing a noƟceable increment
in November 2012 are Retail Trade (53,000),
Professional and Business Services (43,000),
and Health Care (20,000)
The Employment Service industry - mostly includes temporary help services, employment placements agencies, execuƟve search services and
professional employer organizaƟons - rose by 3,800 jobs with a total employment of 3.21 million.

Super Sector Change in Employment (year-over-year)
Temporary nurses in healthcare services
proved to be a lifesaver for 1.3 million pa-
Ɵents across California, Florida, New Jersey,
and Pennsylvania, in more than 600 hospi-
tals. This trend also contradicts the myth
that “poor paƟent outcomes once believed
associated with the hiring of supplemen-
tal nurses in hospitals” (study published by
Health Services Research) is actually caused
by poor working condiƟons within those
hospitals.

According to this new study by researchers
at the University Of Pennsylvania School Of
Nursing, the American Staﬃng AssociaƟon
emphasized the importance of temporary
nurses for the industry and paƟent care

“Our study showed these nurses could be lifesavers…Hiring temporary nurses can alleviate shortages that could produce
higher paƟent mortality.” ~Linda Aiken, lead researcher and professor of sociology and nursing


Online Job Growth

In Percentage
(Source: Monster.com via Staffing Industry Report Webinar – December 2012)

Online staffing brought in a new set of workers, which was not previously possible, either technically or economically.
As per a survey, 71% of the respondent want to engage more online workers, whereas the remainder either preferred to stay at the
same level or less. Out of those that wish to onboard more online workers, 61% of the survey respondent plan to increase their spend
by 50% or more.

Online staffing triggered investments by the companies. Total esƟmated global spend in 2009 was $250 million (approx.), whereas
2012 total investment increased around four Ɵmes to $1 billion.

Online Posting Year-over-Year and Index
170 12%
160 10%
150
8%
140
6%
130
4%
120
110 2%

170 0%

(Source: Monster.com via Staffing Industry Report Webinar – December 2012)


Service-Sector Hiring to Hit Four-Year High
According to a naƟonal employment report released by the Society for Human Resources a Management, hiring in the service
sector is expected to hit an all Ɵme high since the last four years.

43.3 percent of service sector companies will hire while 9.3 percent will reduce their workforce, resulƟng in a net increase of 34
percent. This shows an increment of 21.8 percent compare to December 2011.

Meanwhile, the manufacturing sector is expected to slightly reduce their hiring for the ﬁrst Ɵme in the last ﬁve months. However,
a net of 25.3 percent of manufacturers plan to add jobs in December 2012. That compares to a net increase of 29.1 percent in
December 2011.

(Source: December 2012 SHRM LINE Report)


Employment Projection in 2013

The Engineering industry is expected to grow by 5%, Finance and AccounƟng by 7%, and Legal by 2%.

It’s important to remember more than 1.3 million private sector jobs have been created this year and business condiƟons point to
conƟnued modest job growth,” said Scot Melland, chairman, president and CEO of Dice Holdings.

U.S. unemployment will stay close to the current 7.9 percent rate in 2013 but gradually decline to 7.2 percent by the end of 2014,
according to the UCLA Anderson Forecast’s fourth and final quarterly report of 2012.

The outlook predicts that the U.S. gross domesƟc product will grow at less than a 2 percent annual rate through mid-2013. AŌer that,
the forecast expects growth to pick up and exceed 3 percent for most of 2014 with housing acƟvity leading the way. By the end of
the forecast period, inflaƟon is expected to be above the 2 percent target, bringing an end to the zero-interest-rate policy that has
been in place since late 2008.

2013 Major Industries Contributing to Employment

(Source: UCLA Anderson Forecast and Staffing Industry Analysts)



Projection: Top 10 Industry to Grow (Employment) in 2013

Employment Outlook in 2013
According to MaƩ Ferguson, the CEO of CareerBuilder, the “U.S. will produce the most jobs in 2013 is likely to follow growth paƩerns
of the last few years”, especially that of 2012 onwards.

Professionals such as soŌware developers and computer analysts in IT-related jobs, and sales representaƟves in wholesale, along
with scienƟﬁc trade posiƟons are likely to see an improvement. People with technical degrees, such as mechanical or industrial
engineering and logisƟcs, are also expected to see a posiƟve trend for employment.

As per an economic panel and forecast, the U.S. economy output will slowly rise from 1.9% to 3% by the fourth quarter of 2013.
Growth in employment is expected at a steady rate.



In spite of a few challenges emerging from the recovering economy, a few sectors will conƟnue to boom, such as contract and
temporary help services and the service sector. As per the NaƟonal Restaurant AssociaƟons (NRA) Restaurant Industry Forecast for
2013, America’s over 980,000 restaurants are expected to have record sales in 2013 with a close to 4% increase from 2012. This will
conƟnue to be one of the largest job creators in its segment, which is close to 13.1 million workers engaged in 2013.

The Department of Labor (DOL) had a budget request in FY 2013 of $12 billion in discreƟonary budget authority and 17,419 full-Ɵme
equivalent employees (FTEs). This request is to support the Secretary of Labor’s vision of “good jobs for everyone”, as discussed in
detail in the DOL’s Strategic Plan. The Plan is an outline of the DOL’s strategic and outcome goals over ﬁscal years 2011 to 2016

Top 10 Industry (month-over-month) growth in Employment (2010-2012)

Professional and technical services

Temporary help services

Employment services

Food services and drinking places

AccommodaƟon and food services

Health care

AdministraƟve and support services

AdministraƟve and waste services

Health care and social assistance

EducaƟon and health services


Focusing on Youth: Temporary Employment and Safeguards

Holiday Bring Increase in Temporary Employment
For many retailers, the holiday shopping season is a “make or break” period that can define their boƩom lines for the enƟre year.
Temporary and part-Ɵme employment spikes as retailers and other businesses increase staffing to accommodate their seasonal
increase in business.

Many students experience an increase both in their free Ɵme and their need for extra cash around the holidays. As many retailers
have an increased need for seasonal/ part-Ɵme help at that same Ɵme, many employers will fill their seasonal and/or part-Ɵme
posiƟons with young workers. It is oŌen a good fit for both parƟes.

WHD Safeguards the Young / Minor employee
The Department of Labor’s Wage and Hour Division (WHD) aims to promote and enforce compliance with labor standards,
parƟcularly as it relates to child labor. Youths aged 14 and 15 can be employed outside of school hours in a variety of
non-manufacturing and non-hazardous jobs for limited periods of Ɵme and under specified condiƟons. Any work not specifically
permiƩed, as per the DOL’s child labor regulaƟons, is prohibited. Those aged 16 or 17 can be employed for an unlimited range of
hours in any occupaƟon except for those deemed hazardous by the Secretary of Labor.

Youth Employment 2012: Facts and Figures
According to the Bureau of Labor Standards, the youth labor force (16 to 24 year olds working or acƟvely looking for jobs) had
employment reaching 19.5 million in July 2012. The labor force parƟcipaƟon rate for all youth in July 2012 was at 60.5%


Focusing on Youth: Temporary Employment and Safeguards

Prospects Bleak for Recent College Grads

College graduates, despite an improving
economy and job market, have an uphill climb
towards finding employment post-graduaƟon.
According to the Economics Policy InsƟtute,
almost 50% of recent college graduates are
unemployed or underemployed. And per a
July 2012 Wall Street Journal ArƟcle, young
graduates face the bleakest odds amongst all
job seekers with a real unemployment rate
around 17%.

However, Forbes Magazine, along with
several career consultants, encourage collage
students to target temporary employment as
an avenue for a career. With temporary jobs
increasing for nine consecuƟve quarters, it is
a legiƟmate strategy to pursue.

Even hotspots for young workers, such as Silicon Valley, project employment growth to be made up primarily of contract or
lower-salary opportuniƟes. Dr. Bonnie Snyder, author and college/career consultant, points to temporary labor as the one hopeful
point of the disappoint college job reports, and advices unemployed college graduate to seek opportuniƟes with local temporary
agencies. She states that “temporary work can be like a paid internship…if you do a good job, it’s likely that the employer will seek
ways to try to keep you on.” Members of the class of 2012 have stated finding success by using internships and work-study programs
not just as resume boosters but also gateways to permanent jobs.

“Employers remain hesitant to add permanent employees due to uncertainty about the current strength of the economy and
future economic condiƟons, including impeding tax increases and spending cuts expected to take effect in January 2013. In Ɵmes
like these, businesses are being much more strategic in sourcing addiƟonal talent and maintaining workforce flexibility” ~Richard
Wahlquist, CEO of ASA


Unstructured Data Analysis: From Mystery to Magic

CompeƟng on analyƟcs has spawned poster-boys in the tech boom. Agile, early adopter of new technologies, companies that
embraced innovaƟon and technology stood tall above the compeƟƟon. Moore’s law ensured processing came easy, cheaper and
faster. SoŌware costs came down and more and more open source soŌware conƟnues to make analyƟcs even more exciƟng. In the
new fronƟer that excites innovaƟve companies, unstructured data analysis has been most prominent. The field is oŌen referred to
by many similar and equivalent, but someƟmes misquoted sciences - Natural Language Processing, ComputaƟonal LinguisƟcs, or
text/web mining are but a few. In this arƟcle, we unravel the mystery and power of unstructured data analysis so that managers can
implement and use to their advantage.

What is Unstructured Data in a Firm?
An enterprise generates unstructured data in mulƟple forms and formats.. Emails, contracts, policies, standard operaƟng
procedures, meeƟng minutes, sharepoint and shared drive documents, presentaƟons, consulƟng reports, audit reports, archives,
invoices, customer feedback – the list is endless. Structured data is in form of tables, which most of us know of through
spreadsheet packages like Excel. Many of us can “play” around with structured data using our excel skills but need the company’s
analyƟcs person to analyze customer feedback from mulƟple customers. We need addiƟonal skills and tools to wade through the
maze. Meanwhile, companies cannot afford to ignore criƟcal data in text form, but they don’t possess the capacity to analyze
data beyond the immediate purpose for which it is generated.

Quick winning applications to start with Applications for steady users of
in Unstructured Data Analysis text mining

• SenƟment analysis • Social Network Analysis
• MulƟ-Dimension Scaling • MulƟlingual text mining
• Word Frequency • Anomaly detecƟon
• Document classificaƟon • Live stream analysis
• Intelligent spam filter • Big data and mulƟple sources
• Trend DetecƟon • Clustering


Unstructured Data Analysis: From Mystery to Magic

Challenge of Unstructured Data
In many ways text is like data, but it is important to keep in mind that text is not data. Even in the ways that text mimics data, it is not
readily so and needs some massaging and “structuring” to mold it into a shape fit for analysis.

To understand the challenge of unstructured data, think back to grade school. How different were the subjects MathemaƟcs and
English in school for you? Solving the puzzle really boils down to playing English by the rules of mathemaƟcs and staƟsƟcs while sƟll
treaƟng it as English; and therein lies the challenge. In other words, one needs to convert text to numbers so that powerful algo-
rithms can be applied for meaningful analyses.

Text data has rules of syntax, grammar and expression, resulƟng in the same content being able to carry different meanings.
How true! is not the same as How is it true? The interpretaƟon is also domain-sensiƟve. So, the same text could acquire different
meanings when used in media and entertainment or in say, medical research. Likewise, there are dialect-specific or culture-specific
nuances, sarcasm and emoƟons that alter meaning that must be inferred from context than mere words. All of this complicates
analysis.

ComplicaƟon in analysis has its own secondary problems too. One needs powerful algorithms, unique training of machine to a
model, since most text mining applicaƟons are context-specific and then it needs large scale processing. In fact, all serious users of
text mining know the latest buzzword, “big data”, very quickly.

Another challenge is in terms of achieved accuracy levels in using predicƟve analyƟcs or algorithms in classifying text data. OŌen a
60-70% accuracy is the best achievable. It may sƟll be an asset compared to not using text mining, because it possibly took seconds
and one is at least not worse off by using it. But addressing this issue appears opƟmisƟc due to recent improvements in research,
accessibility and computaƟonal powers.

The Good News
The challenge is steep but then we have come a long way. As menƟoned earlier, processing power, bandwidth and big data making
huge storage and processing power once available only to naƟons and biggest corporate, are now available to lay users at a piƩance.
Growing research in the area is encouraging adopƟon in an increasing number of areas. Open source tools are available and
sophisƟcated add-ons to these are updated frequently. Many of the popular analysis and staƟsƟcal packages have a text mining
add-on or opƟon too, and many of these are very sophisƟcated at that.

A Case Study: Recruitment Streamlining through Algorithm Based Candidate Profile Classification

In a pilot done by DCR Workforce, candidate profiles were used to do machine learning and “train” the algorithm to grasp features
from a test data of resumes of candidates applying for a technical job posiƟon. Subsequently, aŌer validaƟon of classificaƟon of
candidates into Accept/Reject categories, the algorithm was run on fresh resumes. A further improvement and larger database to
improve outcomes resulted in a score each for all unseen resumes. Recruiters now could review profiles and shortlist for interview in
a decreasing order of priority of profiles. Valuable hours were saved for recruiters, and metrics like resumes read per candidate
selected and resumes maintained, shortlisted, selecƟvity raƟo- all showed significant improvement.

Going Forward
As you can imagine, many big data sources are unstructured, resulƟng in the analysis of unstructured data to emerge as a popular
topic for managers in a whole array of industries. Industry leaders are starƟng to recognize the importance of unraveling this valuable
informaƟon with appropriate informaƟon extracƟon into a manageable size and format. Having this valuable insight into the “big
picture” rather than a simple sample set will allow companies to make key decisions substanƟal to enhancing business performance.
The mystery of unstructured data can truly turn into a magical formula for companies in all sectors.

Next month, we conƟnue our examinaƟon of uƟlizing unstructured data, parƟcularly the methods for extracƟon. Look out for an
interesƟng follow-up arƟcle in which we discuss another applicaƟon of text mining using customer feedback data.


Methodology
The DCR Wage Index is developed to assess the relaƟve movements of temporary wage rates in the U.S. economy. The
wage rates for temporary workers or conƟngent workforce are based on payments made by staffing firms to these
workers based upon hours worked. Data collected from sources such as Bureau of Labor Standards (BLS) and other
government sites as well as an internal pool of staffing companies and consultants, is aggregated and classified based
on regions and skill categories, to arrive at an aggregate index.

The baseline for the index is set at 100 for January 2007. Index value for a parƟcular month indicates relaƟve wages with
the said baseline and is representaƟve in terms of direcƟon and scale of change. Five years of data has been included
to observe seasonal paƩerns and disƟnguish seasonality from long-term wage movements. The data and the model has
been further refined over last six months.

DCR Wage Index combines the exhausƟve data from BLS with pracƟcal and more recent developments and data from
on-field consultants and clients, to provide Ɵmely near-term indicaƟons of trends and consistent long-term acƟonable
and objecƟve informaƟon.

Source Data
DCR Work Index uses mulƟple economic variables to ensure the robustness of its forecasts and cross-validaƟon
of trends.

Key data sources and parameters of interest included and influencing the index are:
Unemployment data
Gross DomesƟc Product
Prime rate of interest
New and seasonal Job openings
Non Form employment
Job Opening
All Export
All Import
Average Hourly Earnings of All Employees Total Private
Aggregate consultant data on job market parameters

References:
hƩp://social.dol.gov/blog/Ɵs-the-season-of-holiday-hiring/
hƩps://staffingindustry.com
hƩp://www.dol.gov/dol/budget/2013/bib.htm#.UMpa23Pjnhs


About DCR Workforce
DCR Workforce is an award winning, best-in-class service provider for conƟngent workforce and services
procurement management. Our proprietary SaaS plaƞorm (SMART TRACK) assists in providing customizable VMS
and MSP SoluƟons to manage, procure and analyze your talent with complete transparency, real-Ɵme control, high
performance and decision-enabling business intelligence.

DCR Workforce serves global clientele including several Fortune 1000 companies. Customers realize greater
eﬃciencies; spend control, improved workforce quality and 100% compliance with our services.

For more informaƟon about DCR Workforce and its ForecasƟng Toolkit (Rate, Demand, Supply and Intelligence)
including Best PracƟce Portal, visit dcrworkforce.com

For more informaƟon call +1-888-DCR-4VMS or visit www.dcrworkforce.com

Public RelaƟons:
Debra Bergevine
508-380-4039
7815 NW Beacon Square Blvd. #224 Boca Raton, FL 33487
debra.bergevine@dcrworkforce.com | sales@dcrworkforce.com | markeƟng@dcrworkforce.com

www.dcrworkforce.com | blog.dcrworkforce.com

facebook.com/DCRWorkforce
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lin twiƩer.com/DCRWorkforce
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© 2012 DCR Workforce, Inc. All Rights Reserved. DCR Workforce and Smart Track are Registered Trademarks. CCO — 082912


DCR Trendline January 2013 – Contingent Worker Forecast and Supply Report

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DCR Trendline January 2013 – Contingent Worker Forecast and Supply Report