Printer Friendly

Taking care of the headaches.

Four Indiana temporary services make Inc. magazine's 500 fastest-growing private companies.

Temporary-service companies have been around since World War II, but it wasn't until the early 1980s that the industry became the third-fastest growing industry in the nation.

Dennis Takayoshi of Manpower in Indianapolis cites technology as one reason the concept caught on quickly in the 1980s. "The big difference was the big change in office equipment," he says. "People were not trained in these areas at that time." Seeing the situation as an opportunity, temporary companies trained their employees in the new technology. "We had someone who was qualified to go out and operate that machinery."

Another reason temporary business boomed in the '80s was the recession in 1982, says Virginia Gunther of Indianapolis' Talent Tree Personnel Services. "Before 1982, companies would hire a permanent person to answer phones and lick envelopes," she says. "Companies realized they no longer had the luxury of keeping full-time staffs." With this realization came lay-offs." With this realization came lay-offs. Toward the end of that recession, companies made the commitment to hire temporaries until business stabilized. When business improved, the companies would have the option of hiring that pre-screened temp.

Today, temporary help is a $20 billion-plus industry with a bright future. In 1992, five million people were registered with temporary companies, working at least one job lasting an average of 4.04 weeks.

Although the temporary industry suffered a setback during the most recent economic downturn, companies once again looked to temps as the economy improved, before making permanent hires. Is the industry, then, a leading economic indicator? Possibly. Some Indiana companies have noticed increased business in the past year. Flexible Personnel in Fort Wayne, for one, grew 50 percent between early 1992 and early 1993. Action Temporary Services in Evansville has had a 300 percent increase in business in the past two years alone. In 1992, of the 12 Indiana companies included among Inc. magazine's 500 fastest-growing private companies in the nation, four were temporary-service companies.

"There are a lot more jobs available than qualified people," says Kathy Rogers, president of Fort Wayne's Time Temporary Services. And signing on qualified employees is no small effort. Out of about 1,000 resumes received by Time's offices weekly, only about 30 percent are qualified.

Some of the company's recruiting efforts include working with real-estate agencies and identifying relocated spouses who are seeking employment. With corporate downsizing so prevalent, retirees are also a target. "Some people are not ready to retire, but want to keep working," Rogers explains.

Today's Temporary stresses its efforts to attract and retain good temps. It offers benefits such as two weeks of paid vacation, six paid holidays, training, and parking allowances, and its temps are awarded prizes based on productivity, says Todd Garey of the Indianapolis office. These prizes can include shopping sprees and entertainment packages.

Temp companies also are looking more to specialized niches to help boost their share in the crowded marketplace.

"You can only invent the wheel once, but maybe you can put different spokes on it," says Jay Wilkinson of Corporate Staffing Resources in South Bend. The spokes, he says, relate to specialized services.

Wilkinson's company, ranked 118th on the Inc. 500 list, is adding a new spoke called Skytech, which will provide labor to aircraft companies as well as maintenance and modification companies.

Technetics in Indianapolis began as an electronic job shop for assembling circuit boards in 1973. President Michael L. Scherer was way ahead of the game when his customers started renting his engineers and technicians. "We didn't know it at the time, but it was technical services," Scherer says.

According to Ryan Stoneburner of Fort Wayne's Flexible Personnel--ranked 343rd on the Inc. 500 list--the medical side of temporary services is experiencing tremendous growth. "At this time, home health care is the fastest growing segment of the temporary help industry," he says. Studies have shown that people recuperate faster in their own homes, and recovering at home is more cost effective than staying in a hospital, he explains. Med One Home Health Care Inc., an affiliate of Flexible Personnel, operates on three levels: skilled nurses, RN or LPN; homemaking assistance; and visits by professional home health aides.

But not all specialized services are quickly gaining ground. The concept for temporary executives is quite simple: retired or between-jobs executives act as consultants on a short-term basis. Dick Benson of Indianapolis' Quality Temporary Services says that many executive-level positions require confidentiality, which could be compromised by using temporary help. The key is to identify projects that don't require confidentiality or trade secrets. "It'll just be a matter of time before it's accepted," Benson says. "Ten years from now, we'll see a lot more temporary executives than we see now."

Scott Toussaint of Indianapolis' Toussaint & Co. equates shopping for a specialized temporary service to shopping for a Rolls Royce with a dealer who knows that model inside and out. "There's always going to be room for niche companies," he says. "There's always going to be room for Rolls Royce service."

On the other hand, Don Taylor of Shelbyville-based Personnel Management--which provides staffing for both industrial and clerical environments and is ranked 226th in the Inc. 500 list--believes that becoming too much of a niche player can make it harder for customers to find the right temp company. Industrial and clerical positions may be quite different, but he says offering both is more convenient for the client. "They'll select one service to provide all their staffing," he says. "They know us. We know their company. They can choose one service instead of two."

As competition grows, so do related support services. Action Temporary Services in Evansville offers a useful service to industrial clients. "We are the only service in Evansville with 24-hour counselors," says Kim Devine of the 184th-ranked company on the Inc. 500 list. "A supervisor can pick up the phone and call us at midnight."

Another industry striving to make personnel tasks a lot less of a hassle is employee leasing. And it's growing just as fast as the temp business.

"Companies are getting back to basics," says Stephen Cobb, executive vice president at TFE Inc. in Indianapolis, "and they realize they can't be experts in everything that's necessary to run a business." In the 1980s, many more small businesses became overwhelmed with personnel paper work, and that trend continues.

Simply put, employee leasing means permanently making use of workers who are employed by a leasing company. An employer may arrange to have all of its workers transferred to the leasing company along with payroll and benefits responsibilities. The client company pays a fee for the services, but is freed from all of the personnel and tax paper work.

"The sheer magnitude of government regulations makes it more attractive to go to employee leasing," Cobb says. "With so many laws, employee leasing takes that burden off the employer."

Candy Wilson of Greenfield's Management Control Systems agrees that human-resource management is more complicated than ever. And who better to take care of it than personnel experts? She lists the I-9 Immigration Form as an example. This form verifies U.S. citizenship or naturalization for all employees. If the form is incomplete, Wilson says, an employer can be fined up to $1,000 per day per employee. Then there are labor laws, tax laws, worker's compensation and a slew of other paper shuffles.

Altogether, there are about six general personnel matters an employer must attend to: insurance, other fringe benefits, payroll, taxes, supervision and hiring and firing. Within these six categories, there are about 45 separate tasks to worry about. By signing on with a leasing company, three of those categories can be wiped out completely, and only six tasks remain under the other three categories.

Some advantages to a partnership with an employee leasing company are obvious, such as better employee benefits. "I think that with the healthcare crisis, small businesses are forced to look elsewhere for benefits," says Linda Colins of American Benefit & Personnel in Munster. Insurance premiums for a small company can be quite high, but by leasing employees, small employers can take advantage of volume buying.

Probably the largest obstacle employee leasing has to face is educating companies and getting them to understand the concept. "The employers are worried they'll lose control of their employee base," Wilson cites as a concern. "They actually gain more control." The business owner still makes all the decisions, she says, and the leasing company advises the owners on human-resources matters.

And getting rid of all the paper work allows a business to concentrate on what it set out to do in the first place. Whether from a temporary-service company or an employee-leasing firm, the personnel experts can be called on to solve just about any personnel-related problem.

As Russ Cheesman, president and CEO of Management Control Systems Inc., says, "We're the aspirin of the business world ... we take care of the headaches."
COPYRIGHT 1993 Curtis Magazine Group, Inc.
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1993 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Title Annotation:temporary services companies
Author:Gilbert, Jo
Publication:Indiana Business Magazine
Date:Apr 1, 1993
Previous Article:Reprints R Us.
Next Article:Batesville Casket Co.

Related Articles
Brewer personnel in national spotlight.
Labor crunch.
Meeting human resource needs has never been easier.
Pains in the brain.

Terms of use | Copyright © 2016 Farlex, Inc. | Feedback | For webmasters