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The Evils of Temp Agencies

I started this forum to discuss the current increasing trend in the United States for employers to hire temporary employees through temporary employment agencies and to discuss current news about this issue.

My personal experience has found that:

* temp agencies are short-term solutions to obtain temporary employment
* if you apply for temp-to-hire positions sometimes it works out and you become a permanent employee of the employer
* Medical insurance and other benefits provided by temp agencies are a short-term solution to obtaining coverage between jobs

I worked for Addecco for a year with just one corporate employer. Addecco invested a lot of training for employees and the training was valuable. However, after a year, Addeco began laying off many workers from that employer and about 30 people were laid off. Only one worker was hired by the employer as a permanent employee. When I went to the State Employment Office, experienced job counselors there told me two (2) things:

1) More and more employers are hiring temp workers instead of permanent, full-time employees so they don't have to pay for insurances and other benefits.

2) Move away. YES - they told me to MOVE out of the STATE!!

Here is an interesting short article with the New York Times about the history of temp agencies in the United States:

opinionator.blogs.nytimes.com/2013/01/26/the-rise-of-the-permanent-temp-economy/?_r=0

The Huffington Post has had many interesting articles lately about temp agencies. One very alarming piece of information I gleaned from their articles is this:

"More recently, temp firms have successfully lobbied to change laws or regulatory interpretations in 31 states, so that workers who lose their assignments and are out of work cannot get unemployment benefits unless they check back in with the temp firm for another assignment."

Is this not horrifying?
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The reason people keep going back to temp agencies is because companies wont go back to hiring people in full time positions. Temp agencies arent a good thing. Their a last minute, bottom of the barrel option. Not because of temp agencies themselves, but because of multibillion dollar companies( sometimes less) not wanting to invest. I get people are hard to identify as either good or bad workers. But I also am not a big fan of being told consistently that my full time position is just around the corner. 8 months I worked for a temp agency that kep telling this lie. Even the companies supervisor kept the same script. I realized after wasting 8 months of my life at a horribly toxic company, it was all to keep me there and showing up to work. I was good enough to keep working 12 hour shifts and explaining away the hostile work environments, workplace harrassment, and religious discrimination, but not good enough to hire full time? Temp agencies are a big hinderance to full time employment. And as long as companies like that exist, full time positions will become more and more rare.

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Tuesday Solution by original poster
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So, I worked for a temp agency as a recruiter for 2 years and I hope I can offer some insight. I also no longer work there, so I have the benefit of looking at the industry from an outside perspective now. All temp agencies are not created equal, first of all - I can only speak for myself, but I really cared about everyone who worked for me, even though I was disappointed by employee no-shows, walk-offs, and call-outs basically all the time. I also saw a lot of companies screw over the temps and there was absolutely nothing I could do about it. When you're the middle man, it's easy to get blamed by both sides, when you're just the messenger (in both directions).

Try to find a local agency if you can, one that is based just in your state or a couple of other states. A local agency is going to care a lot more about and be a lot more connected to the community than a national would be. Avoid the agencies that have you sitting in the lobby every morning waiting for a van, they are extremely exploitative. If you have a special skill, like tech, creative, or healthcare, there are industry-specific agencies that I understand are actually really great to work for (ours was office/light industrial, so I can't speak to that specifically.) 

To the OP who said ""More recently, temp firms have successfully lobbied to change laws or regulatory interpretations in 31 states, so that workers who lose their assignments and are out of work cannot get unemployment benefits unless they check back in with the temp firm for another assignment." Is this not horrifying?"

Why is that horrifying? The temp agency is your employer. If the company you were subcontracted to no longer has work for you, you have to check back in with your employer to see if there are other assignments. You have to do that because the temp agency is *paying for your unemployment* if you go back on unemployment at that point. If the agency doesn't have another assignment for you, you can go on unemployment without issue. If they do have another assignment for you and you refuse it, you're refusing work, which means you don't qualify for unemployment--which is the same as literally every other company out there. 

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a week ago Solution by original poster
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Why does a company use a temp agency rather than hire directly? First of all, an employer has to pay a great deal more per hour for an employee in addition their actual wage. There are payroll taxes, federal unemployment taxes, and a whole lot of filing that must be done on that employee's behalf. If an employer is paying you $15/hr, they're probably paying more like $17-18/hr to have you on their staff because of taxes and other issues--and that's before you get to the cost of benefits, which is several thousand dollars per year. 

When you work for a temp agency, the agency is your employer, not the company you're working for, so the temp agency is paying those taxes instead of the company. The average mark-up per hour that the temp agency charges the company is about 50% (give or take). So if the agency is paying you $15/hr, company is likely paying the agency around $22/hr, and the agency is bringing in $7/hr. *But*, as we already mentioned, the agency is paying taxes to have you on staff, so the agency is really only *making* $3-4/hr. 

But that doesn't mean that $3-4/hr is profit. The agency has to cover 100% of their overhead from that income. Hiring is expensive. There are the advertising costs in getting the word out, not to mention the recruiters they keep on staff to interview you, test you, advocate on your behalf to the company and get you hired, then manage your paycheck, answer your questions, and yes, sometimes let you go (and I promise you, it was absolutely horrible every time I had to do it. It sucked.) The actual profit that the agency makes is really more like $1/hr or so. They're pretty tight margins, which is why agencies have to deal with such high volumes to stay profitable. 

This is a great deal for the employer because they 1) don't have to pay any of the taxes 2) aren't on the hook for unemployment if/when they lay you off and 3) don't have to deal with the costs associated with hiring--advertising, interviewing, onboarding, and they don't have to deal with any of the HR issues. They just pick up the phone and tell the agency to deal with it. Essentially, they're outsourcing the HR function to a third party.

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a week ago Solution by original poster
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heart implants? like real medical devices?

its nice to know the sophisticated high tech equipment used to keep people alive is made by under payed, overworked and screwed over people. multi billion dollar industry and they cant even pay fair wages. this literally makes me sick to my stomach.

May 6, 2020 Solution by original poster
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Can some give me an example of how much an employer saves on a temp verses a full time worker? I get they don't pay benefits but they also pay the temp service more per hour. So in the end what's the savings?

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May 6, 2020 Solution by original poster
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So you found the "unicorn" in the group, the good thing is you were paid more than the regular employees except no holiday pay or paid time off staffing agencies hire recruiters and they get holiday and paid vacation from day one where workers have to work a full calendar year without missing a day to be eligible for one week so hopefully none of your temporary assignments were temp to temp

Apr 29, 2020 Solution by original poster
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@Starlytnite wrote:

The temp agency I'm with now does do insurance and 401k. And is respectable good reputation. 

 

The employer I'm at now which is GE, I just dont like them. The make me feel. I have to. Make up the slack of the GE worker. 

 

She gets appreciation dinner when she only does 5% gets away cause. Shes 50 and I'm 30. Shes.  More tired then me they say

 

I have to stay late to do parts she should have done. I have to stay late so she can talk football talk to everyone

 

The company is finally sending orders on time. 

 

And she gets the credit 

 

When really its us temps 

 

And we get no appreciation 

The plant manager wont even look at me

 

I want to walk out, go on strike

 

But I dont want to loose the temp. Agency

I'm just suffering til my assignment is over


If you walk out, the temp agency will not use you again. You do know that right? I think you should either try to find a new company while still employed there. Or, stay there, but contact another agency, and look for something better. I agree with the OP, these companies and job trend are the devil. But sadly, it is what it is.

Jan 23, 2020 Solution by original poster
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The temp agency I'm with now does do insurance and 401k. And is respectable good reputation. 

 

The employer I'm at now which is GE, I just dont like them. The make me feel. I have to. Make up the slack of the GE worker. 

 

She gets appreciation dinner when she only does 5% gets away cause. Shes 50 and I'm 30. Shes.  More tired then me they say

 

I have to stay late to do parts she should have done. I have to stay late so she can talk football talk to everyone

 

The company is finally sending orders on time. 

 

And she gets the credit 

 

When really its us temps 

 

And we get no appreciation 

The plant manager wont even look at me

 

I want to walk out, go on strike

 

But I dont want to loose the temp. Agency

I'm just suffering til my assignment is over

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Dec 22, 2019 Solution by original poster
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Temp agencies lie (lying by omission is still lying) by calling a temp position 'temp to perm' or leaving out key details that you don't find out about until you start the position (ex. its only part time 32 hours ) and if you dare ask too many questions or do anything wrong your temp assignment will end in a NY minute with no notice other than a phone call from the temp agency in the evening telling you not to return to work
Oct 9, 2019 Solution by original poster
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I've only held one temp-to-hire position. I did get hired (admin) after my 90 days and got a .50/hr oncrease (plus benefits...so I was fine...was glad to get back to a full time job after 2 years due to an illness and relocation). After a year, that company couldn't afford to keep me any longer...now unemployment...but now have found a potentially much higher paying FT positon ...once again...temp-to-hire...almost double what I was making a few months ago (but about 10k/yr less than a few years ago...but at least it's upward and onward now..!). Question is...what is an acceptable rate of increase once hired typically in an admin/accounting positon? I know the benefit package needs to be taken into consideration, as possibly any potential changes in the position. Thanks!
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Oct 9, 2019 Solution by original poster
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To all of you complaining about temps making more $ and temps taking over jobs that would otherwise be a permanent position for someone else...uhhh, that’s the companies fault. The temp agency is simply filling a need. They are not going to turn it down b/c it’s $$$...I guess what I’m saying is “don’t shoot the messenger/middle man"
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Sep 22, 2019 Solution by original poster
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People who use temp agencies I believe they are becoming more spoiled by the day. The temp agency I work for does all we can to get them into the right job after we get them into our system. A lot of them that come in are extremely rude (these are the one that I never give jobs to)..then, on the other hand we have some extremely dedicated workers that have been with us for a long time. Many of them can not find a full time job because of their record or maybe a current case against them. So you see, there are barriers in many cases, so if I was a temp “looking" for temp work, I would take what I could get...otherwise I wouldn’t make a penny! Also, we do a lot of leg work and put a lot of hours into our personnel so that we can fit them with the right customer. Many do not have transportation, so we work that out as well...we pay their insurance, etc.. and everyone still wants to complain about something the temp agency did wrong at the end of the day..most of my day is spent on the phone or in office dealing with our personnel trying to nickel and dime me for whatever reason, and it’s hard to get things done during the day b/c of this. Look, this is America, nothing in life is completely fair on each individuals personal level..it’s just never going to be perfect. And given that many people turn to our agency when they have exhausted most if not all of their options, I honestly believe temp agencies are a great thing. Not perfect, but better than people assume! Also many times I believe that the temp service catches the blame for things that should actually be blamed on the customer they are working for..this is just my opinion..honestly, if temp agencies didn’t exist; would it be a better thing or worse thing for our society/economy? I just think that this is an industry that can’t be compared to any other industry. It’s a weird but cool industry to work for, having to find he perfect balance between your personnel and custimers In which you do business.
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Sep 22, 2019 Solution by original poster
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Maybe you should get a college education. Then you wouldn't an outsource for a smarter employee who's on vacation or paternal leave. Temps are warm bodies that cheaply supplement a much more valuable person.
Aug 20, 2019 Solution by original poster
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Sounds so familiar. Adecco, Randstad, Burnett, Staffmark: I have been with all four and nothing permanent ever came close to materializing despite 100% effort from me. And benefits? Maybe a donut on your first day of training if you're lucky.
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Aug 12, 2019 Solution by original poster
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This exact situation is happening to me right now. I make heart implants for a company that cuts people's pay upon conversion, and hires exclusively temps. They couldn't get enough applicants so they raised temp wages, but not employee wages. They keep trying stuff like not paying out the extra PTO employees bought (because they can't take unpaid days off), also our saturday shifts start 8 hours after our friday shift ends (technically legal.) The parking lot is overcrowded, they know and are hiring more anyway. I'm quitting after 8 months.
Jun 4, 2019 Solution by original poster
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I don't understand why temp agencies say you have to have recent experience. If I have recent experience then wouldn't I still be on a job somewhere? How can I get experience if I don't have a job? This is so strange to me. If I can type and use a PC, most jobs will train the employee on their systems anyway right? I was a stay at home mom for several years. I have a degree and I had 23 years of Gov't experience and now I cannot get a simple Admin job? Isn't this the best job market (2019), where are all the jobs? Your insights please!
Mar 19, 2019 Solution by original poster
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Temp agencies can be bad, but some companies need people for a special project only, or their work is so cyclical that it doesnt make sense to constantly lay off and hire employees. I think working for a company through an agency is going to be the wave of the future.

I just have my fingers crossed that this company that I am temping at right now will pick me up.
Sep 30, 2018 Solution by original poster
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If you want direct hire you literally have to look several times a day EVERY day including weekends. I did this when I was job hunting and applied for jobs (and got interviews) where the ad was down later that day or the next day.

Mia, staffing agencies can be good for local temp work instead of trying to find something permanent on a specific shift. Kudos to you for taking that packing job though.
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Sep 30, 2018 Solution by original poster
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And I took a warehouse packing job and it was an absolute sweatshop in about 90 degree heat for 10.00 per hour, through one these stupid staffing agencies. I about passed out from the heat and lack of water. I think the USA has turned into a third world country.
Sep 30, 2018 Solution by original poster
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All I see on Indeed.com and Career Builder are staffing agencies, not direct placement with companies. What is going on? There is no work!!! I cannot find a simple data entry job overnights in Illinois unless traveling all the way to Chicago, which I cannot do (too far). And it does not give me time enough to travel back to my day job that starts at 8am. 15 and 20 years ago there were a lot of data entry and call center jobs in Illinois on 3rd shift - not anymore. I need to work 2 full-time jobs to make ends meet and I cannot find anything on 3rd shift except for warehouse work which includes heavy lifting. Where are the jobs???

I am tired of seeing hundreds of staffing agency postings all over indeed and career builder. I want to see real jobs back in Illinois and the United States.
Sep 30, 2018 Solution by original poster
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Yes, it's absolutely true. The staffing agencies can only get a contract if they have big volume and this will happen only if the staffing company can show around 1000 job seekers application turnover every month.

I applied at one the staffing company for Admin position. My testing results were excellent was I was over qualified. They send my resume to some oil company and the job position was postponed for a limited period of time. I checked on line (staffing company's website) and applied more jobs to see if they have any lower job position where they can fit me. There was no call from them afterwards.

It's strange but that's how it works. All the staffing agencies need your resume in their database to get them a solid contract with the company. Lot of times staffing agencies put fake job posting on Indeed, Career Builder and other websites because there are not bound to mention the client (company) name.

Your response time will be much more faster when you apply at other places and you don't need to go with testing and other formalities.
Sep 13, 2018 Solution by original poster
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Shaun I would definitely try to apply for unemployment. It won’t hurt right?
I’m following these comments because I’m considering starting an employment agency myself. I’m for the people and I know how difficult it is for people to find jobs because most employers are looking to hiring through temp agencies. It saves them time and money recruiting new employees, it also makes it easier if the candidate isn’t what they are looking for to let them go. I want to change the industry for the better. I hope everyone on this thread finds successful employment. ☺️
Sep 13, 2018 Solution by original poster
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I know this temp agency thing should be short term, but I'm making decent money. My biggest complaint is the lack of vacation time and medical coverage. I've been offered a full time position 2 or 3 times now but the company is moving an hour north of me and I can't make the commute. As a temp I'm making 15 an hour but if they bring me on I'll drop to 12.50.For the most part I was working 40 hours and I'm the only temp they hired thru my agency(GES) and I'm one of the first to get a call when they need help. But now, the hours aren't there. I haven't worked in 2 weeks but I'm contracted to this company so my agency can't place me elsewhere. Is is possible to collect unemployment in this situation?
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Sep 7, 2018 Solution by original poster
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This happened to me. I was working with Randstat and they placed me with a company as a temp to hire but the company had no intention of hiring me. They strung us along for 6 months, and then it got to the point of where I told them that I need to look for full-time, permanent employment. I also told them that I was willing to continue to work for them during this process but I would need slight accommodation in order to schedule interviews. I would make up the time so I would still be working a full, 8 hour day.

They let me go. I applied for unemployment, they fought it and it went before a judge. I won.

These temp companies couldnt care less about you. They are essentially garbage.
Aug 13, 2018 Solution by original poster
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I'm in HR so I've dealt extensively with temp agencies. Some of them are fairly good to their employees and the company that uses the temp agency does so with the intent of finding people to hire full-time. I've found many good hires over the years through temporary agencies and it benefits the employees since they can decide if they like the work and supervisor they will work for. The supervisors like it because they get a much larger say in the hiring process.

On the other hand, I've seen temp agencies where the employees are treated poorly and have seen companies that will string temporary employees along with the promise of a full-time job that never materializes. Temp work is often the fastest way back to work after a job loss but it should be treated as just that-temporary.

I have no patience for agencies that treat their employees like crap. In my last role I didn't renew the contract of the temp agency we used because they treated their employees so poorly. It's not like I didn't warn them; I had told them multiple times that I wouldn't renew the annual contract if they didn't start improving their treatment of the employees.
Aug 2, 2018 Solution by original poster
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We got here through just what you've stated, greedy companies. they bribe congress to make laws in their favor. If you or I oppose the temp services, that doesn't matter, we are not buying polliticians so we go unheard.The problem lies at the top, the greedy government that upholds the idea that profit should come before people.
Aug 2, 2018 Solution by original poster
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That's not always true, it depends on the Temporary employees character as well. I always work my butt off when working a temp job.

I do agree with you on companies that don't invest in their employees. The last job I worked I was so dedicated that I quit my day job because I was making more money at the night job. The night job was paying all the temps 12 an hour vs their regular staff only getting 9 - 10 an hour. The regular staff also had not receivied any raises or bonus's for 2 years due to the economy. The company owner and CEO had the nerve to send out letters to all their employees telling them that due to the economy and expenses, that the employees were the most expensive of all so they would not be receiving a raise again for year 3. But the company would hire on temps at 12 an hour while the employees were only getting 9 or 10 an hour and some of those regular employees had been with the company for 4 years. I'm in agreement with you on Greed definitely playing a part at this company, the owner kept his motorhome, boat and motorcycles at the job site. But once someone told a good enough lie that very good temp employee (me) would be tossed like trash regardless of their excellent work. But I know Karma will come back on the night manager that lied too, so it's all good.
Oct 15, 2015 Solution by original poster
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It's simple. Where there is a way to be corrupt and no one in the way to do it there will be corruption. Employers are thinking short term with using temp agencies. For a while many temps will believe the lie and work thier back sides off to impress the employer hoping they will get on permanent. Some temps will actually get on permanent and I have seen who those are and they are not the best workers, they are the back side kissers. The employers think they are sidestepping expenses and they are temporarily using temp workers but in the long run they are losing money because they don't value the most important resource thier company has.....people! When your people don't have any reason to value whether or not the company lives or dies because the company did not invest in them then they will not invest the best of themselves in that company. How do you measure sucess in a business? Is it profit only? or is it when in tough times you have what it takes to make it through....dedicated people in your business. If your employees are temporary and know they can be thrown out any minute they are not dedicated to your business. Think you greedy companies!!!!!! you trade short term profit and lose stability because none of us temporary employees care if you go under tomorrow!!!!!
Oct 15, 2015 Solution by original poster
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Further,

"Temp agencies consistently rank among the worst large industries for the rate of wage and hour violations, according an analysis of federal enforcement data. A 2005 Labor Department survey, the most recent available, found that only 4% of temps have pensions or retirement plans from their employers. Only 8% get health insurance from their employers, compared with 56% of permanent workers."

Another article said:

"According to numerous studies, staffing agencies serve a much more insidious purpose: agencies are nothing more than a tool for employers to cut labor costs by dodging taxes and government regulation."
Jun 29, 2013 Solution by original poster
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I started this forum to discuss the current increasing trend in the United States for employers to hire temporary employees through temporary employment agencies and to discuss current news about this issue.

My personal experience has found that:

* temp agencies are short-term solutions to obtain temporary employment
* if you apply for temp-to-hire positions sometimes it works out and you become a permanent employee of the employer
* Medical insurance and other benefits provided by temp agencies are a short-term solution to obtaining coverage between jobs

I worked for Addecco for a year with just one corporate employer. Addecco invested a lot of training for employees and the training was valuable. However, after a year, Addeco began laying off many workers from that employer and about 30 people were laid off. Only one worker was hired by the employer as a permanent employee. When I went to the State Employment Office, experienced job counselors there told me two (2) things:

1) More and more employers are hiring temp workers instead of permanent, full-time employees so they don't have to pay for insurances and other benefits.

2) Move away. YES - they told me to MOVE out of the STATE!!

Here is an interesting short article with the New York Times about the history of temp agencies in the United States:

opinionator.blogs.nytimes.com/2013/01/26/the-rise-of-the-permanent-temp-economy/?_r=0

The Huffington Post has had many interesting articles lately about temp agencies. One very alarming piece of information I gleaned from their articles is this:

"More recently, temp firms have successfully lobbied to change laws or regulatory interpretations in 31 states, so that workers who lose their assignments and are out of work cannot get unemployment benefits unless they check back in with the temp firm for another assignment."

Is this not horrifying?
Jun 29, 2013 Solution by original poster