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Healing U.S. Labor Market Means Slower Temporary Job Growth

Bloomberg (11/09/12) Anna-Louise Jackson; Anthony Feld

More companies are hiring permanent employees, and temporary employment is contributing less to job creation, an indication companies are more confident about the sustainability of the economic recovery. The monthly change in the number of employees on payrolls of temporary staffing firms averaged 2.2% of the monthly gains in aggregate nonfarm payrolls in the July-October period, down from nearly 19% in the first half of the year, according to seasonally adjusted data from the U.S. Department of Labor. Recent gains in hiring suggest company cautiousness was exaggerated, says Stuart Hoffman, chief economist at PNC Financial Services Group. If companies become more confident about the economic outlook, they could worry that the hiring environment may become more competitive, so would be more likely to add workers on a full-time basis, says Challenger Gray & Christmas chief executive officer John Challenger.