More than 70 percent of staffing industry executives say they expect growth to continue at a lower rate in 2008, and 21 percent predict their business will remain stagnant or decline, according to a survey released Friday by accounting and consulting firm Citrin Cooperman & Co. Only 14 percent said their firms are currently in good financial shape.
The survey polled staffing firm executives from New York, New Jersey and Connecticut in the second half of 2007.
“The staffing industry is cautiously optimistic about their growth, but expect it at lower levels than they’ve experienced in the last three years,” Citrin Cooperman partner Nick Florio said in a statement.
Staffing executives cited competition from other hiring sources, a tightening job market and higher costs for declining profit margins.
Nearly half of respondents said insurance costs remain a major concern, and Florio says many executives believe they cannot guarantee the loyalty of their applicants and placements without providing health insurance. Others forecast a growing demand from clients to provide more coverage.
But despite credit-crunch woes that have led to a number of high level layoffs in recent months, 68 percent of firms surveyed said they don’t have a senior-level financial officer in place, and only 37 percent receive a periodic profitability analysis. Sixty percent said they don’t have a succession plan in place.