US staffing shares fall as temp job growth slows

* U.S. temporary payrolls growth slows to 12 pct in Feb

* Temp demand shifting to professional jobs

* Manpower, Robert Half, SFN shares down

NEW YORK, March 4 (Reuters) – Shares of U.S. staffing and
job services firms were mostly lower after the February jobs
report fell short of the most optimistic expectations even as
it raised hopes a U.S. economic recovery was gaining momentum.

Staffing shares had rallied ahead of the labor data but
retreated on Friday as the government report showed the pace of
growth in temporary employment — the industry’s core business
— slowed last month. [ID:nOAT004757]

The economy added 15,500 temporary jobs last month, and the
temporary help sector was stronger in the prior two months than
was reporter earlier. But the year-over-year rate of growth, at
12.2 percent, was the slowest in almost a year, and well below
the roughly 20 percent pace in August, September and October.

Temporary job growth is shifting from broad industrial and
clerical categories — which were among the first to turn up in
the recovery — to narrower professional categories, where
growth rates are lower, said Tig Gilliam, who heads North
American operations at Adecco (ADEN.VX: Quote, Profile, Research), the world’s largest
staffing company.

“The pace of growth is going to slow down just because the
compares get harder and harder,” Gilliam said.

“There’s not any extra hiring going on. It’s really where
there is a definite need. When clients are confident enough,
they’ll take that temporary or contract employee and make them


Staffing executives predict job gains will accelerate in
coming months.

“We’re really adding jobs,” Gilliam said. “I consistently
expect us to be in the 200- to 300,000 (range) by the summer.
With temp demand where it is, even if it’s not accelerating,
that’s going to lead to more hiring.”

Manpower Inc (MAN.N: Quote, Profile, Research) Chief Executive Jeff Joerres said the
economy needs to add about 130,000 jobs a month to keep up with
population growth, and predicted the economy is on the cusp of
more robust, and more consistent, job gains.

“I think you’ll start seeing more energetic numbers… but
we can’t forget that at 225 (thousand) we’re still four years
out before we’re at the same employment (levels),” Joerres said
in an interview ahead of the February jobs report. (For a
graphic of the jobs gap: )

Manpower next week will release a quarterly survey of
hiring intentions in 39 economies where it does business.

By some measures, the U.S. economic recovery appears to be
gaining momentum. U.S. jobless claims are at a 2-1/2 year low,
U.S. retailers have posted stronger-than-expected sales gains
for February, and the manufacturing sector is growing at its
fastest pace since 2004.

Manpower Inc (MAN.N: Quote, Profile, Research) shares were down 1 percent, while
Robert Half International Inc (RHI.N: Quote, Profile, Research) was down 1.5 percent,
Monster Worldwide Inc (MWW.N: Quote, Profile, Research) fell 7.5 percent and Spherion
Corp (SFN.N: Quote, Profile, Research) was down 0.3 percent.

On the Nasdaq, Hudson Highland Group Inc (HHGP.O: Quote, Profile, Research) was down
1.8 percent and Kelly Services Inc (KELYA.O: Quote, Profile, Research) was off 1.7
percent. In European trading, Adecco shares fell 0.4 percent
while global No. 2 staffing company Randstad was up slightly.
(Reporting by Nick Zieminski, editing by Matthew Lewis)