Temporary-staffing companies face new challenges

Posted: October 18, 2010

Staffing executive William C. Yoh, 39, grew up in the family staffing business, but he never worked as a temp.

"I'm not sure what I'd be qualified for, to be honest with you," Yoh said and laughed, telephoning from a Las Vegas meeting where he had been elected chairman of the American Staffing Association.

In Philadelphia, he leads Yoh, a 70-year-old family company providing contract workers, recruitment assistance, and payroll services to companies in the defense, communications, and science sectors.

Yoh said he was taking the American Staffing Association helm at a time of tremendous focus on the industry, partly because of its sheer size and partly because of its role as an employment bellwether.

The $61 billion U.S. staffing industry employs two million Americans a day, according to the association, which says it is the industry's largest trade group.

Economists often track temporary employment because, at the hint of a downturn, temporary staffers will be the first to be let go, presaging a worsening situation.

Later, in the most nascent stage of a recovery, temporary staffing will start to pick up first as companies begin to need help but do not have the confidence to expand their own workforces.

"We have an index that tracks hiring," Yoh said. "We can tell whether it is climbing or dropping.

"Guess what?" he said. "We first saw increased hiring in June 2009."

That is the month that economists now tag as the recession's official end, despite lingering unemployment.

Yoh said that with the unemployment rate stubbornly fixed in the 9 percent range, it was unlikely hiring of temporary staffers would slow, at least not until the end of 2012.

"If the GDP grows around 2 percent, then the staffing industry is going to grow," he said.

If the recovery takes hold, staffing employment will level off to a more stable number, he said.

Meanwhile, the industry faces challenges, Yoh said. "The biggest thing right now is government regulation," including health care.

Under the health-care law passed in March, staffing-company employers, like all employers, will be expected either to provide health insurance or to pay hundreds of dollars per employee to the government if they do not.

"Very few staffing professionals elect to get their benefits from their staffing company," because, Yoh said, their assignments are short, they often aren't very highly compensated, and they may not be able to afford their share of the premium.

With so few temporary staffers covered by their agencies, the industry will be on the hook for millions of dollars in new expenses.

"The government might count the noses," he said, giving as an example a staffing agency dispatching 100 temporary workers in a year.

But because those 100 work for short stints, they may be putting in the same number of hours as 30 full-timers.

It is not clear how those staffing companies will be assessed, Yoh said.

He said he intended to put a particular emphasis on worker safety during his term, which lasts one year.

"In the past, the industry hasn't focused on safety practices because we have relied on the client" to create a safe working environment for its temporary staffers, Yoh said.

Yoh lives in the western Philadelphia suburbs with his wife and three children. A graduate of Duke University, he earned his master's degree from the Wharton School of the University of Pennsylvania.

In 2009, he became chairman of Yoh and chief customer officer of Day & Zimmermann. Before that he had been Yoh's president and chief executive officer, having risen through the ranks.

Yoh, the company, is a unit of Day & Zimmermann, a $2.1 billion Philadelphia staffing and military-facility management company.

Yoh's grandfather Harold, founder of H.L. Yoh Co., had acquired Day & Zimmermann in 1961, but retained the Day & Zimmermann name because it was better known.

He sold the company to his son, Harold L. "Spike" Yoh Jr., in 1975, and ownership was transferred to the third generation in 1998.

William Yoh's brother, Harold L. Yoh 3d, is chairman of Day & Zimmermann. Founded in 1901, it employs 24,000 worldwide.

Contact staff writer Jane M. Von Bergen at 215-854-2769 or jvonbergen@phillynews.com.

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