Declining U.S. Temporary Workforce

Chart Declining US Temporary Workforce

While the bulk of employment data paints a very strong picture of the domestic labor market, the team at Allegiant always looks for data that may presage any sort of looming slowdown. One dataset that has historically acted as a leading indicator for employment data is the change in temporary workers. As you can see in the chart above, a sharp slowdown in the temporary labor market has historically preceded a recession. This seems to be intuitive, as hiring managers would look to trim compensation expense first by parting ways with temporary workers before laying off full-time staff members. For the first time in years, this indicator just dipped into negative territory and is something we will watch very closely for signs that the longest economic expansion in history may be losing steam.