By: Matt Norton

According to Staffing Industry Analysts’ recently published US Staffing Industry Forecast: September 2017 Update, the engineering segment of the US temporary staffing market is projected to grow by 2% in 2017, an upgrade from our 1% forecast in April. This follows a 2% decline in 2016 (as shown in the graph below). Staffing firms in the engineering space, as well as those looking to enter this segment, can use this report to understand the market dynamics driving its growth and identify opportunities in this arena.

US temporary staffing market size year-over-year growth (%): Engineering segment

chart

Oil prices have increased and stabilized in the first half of 2017, giving a greater sense of certainty and confidence to the energy market, an important sub-sector of the engineering staffing market. In the first half of 2016, West Texas Intermediate average price per barrel was $39; this increased to an average of $50 in H1 2017 while the US Energy Information Administration forecasts WTI prices to average $50/b in 2018. A clear illustration of market improvement, albeit from a low base, is the year-on-year employment growth in Natural Resources & Mining, which includes oil and gas extraction. It was the leading industry for year-on-year employment growth between August 2016 and August 2017, rising 8.8% according to the US Bureau of Labor Statistics.

US crude oil and petroleum product markets were significantly disrupted by Hurricane Harvey in late August, although it is too soon to gauge the full extent of the impact on staffing. We will have a clearer picture when SIA releases updated US forecast in April next year.

Several engineering roles — including electrical and mechanical engineers — continue to have unemployment rates below 1.0%, according to Bureau of Labor Statistics. Supply in these high-demand skills is so elusive that it is impeding staffing growth, and the more restrictive immigration policies proposed would only exacerbate the supply bottleneck. That said, there is an opportunity for firms in these areas that can build and maintain relationships with the most in-demand candidates and provide them with the most attractive opportunities.

Growth rates in the segment continue to underperform relative to other US professional temporary staffing segments such as IT and Healthcare. However, any growth following two years of market revenue declines will widely be welcomed and offer encouragement for 2018.

 

Source:

http://www2.staffingindustry.com/Editorial/Engineering-Staffing-Report/Sept.-28-2017/Staffing-Industry-Analysts-upgrades-engineering-staffing-market-forecast-for-2017

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