As I reviewed the February Employment Report, one number really stuck out. The U6 unemployment rate, which includes discouraged workers and those working part-time for economic reasons, jumped 0.5% to 8.0%. Still relatively low overall—and it’s only one month—but it got me thinking: is there a correlation between the U6 unemployment rate and temporary staffing?
U6 Unemployment and Temporary Staffing: Is there a Link?
After looking into it, my findings? Yes, there’s a clear parallel. The U6 unemployment rate and temporary staffing often move together, particularly during economic downturns or uncertain periods. When the U6 rate rises, businesses tend to hold off on full-time hiring and instead lean into contract staffing to maintain flexibility while controlling costs.
Historical Trends: Great Recession and COVID-19
Take the Great Recession, for example. Between 2007 and 2009, the U6 unemployment rate soared from about 8% to over 17%. During that same period, temporary staffing surged as businesses avoided long-term commitments and opted for scalable workforce solutions.
The same pattern repeated during the COVID-19 pandemic—U6 jumped from 7% in early 2020 to over 22% by April, and again, companies responded by increasing their use of contract workers.
Why Businesses Turn to Temporary Staffing in Uncertain Times
This trend highlights a broader strategy: when economic confidence dips, agility becomes a priority. Businesses need to stay lean and responsive. Temporary staffing provides that balance—access to talent without long-term risk. Plus, job seekers are generally more open to contract roles during tough times, when permanent opportunities are harder to come by.
Don't Let Cash Flow Limit Your Growth
I’ll be keeping a close watch on the U6 rate and temporary staffing data in the months ahead. If you’re a staffing firm seeing demand rise, don’t let cash flow limit your growth. With an unlimited funding program, you can bring on more clients, place more talent, and boost your profits—without financial bottlenecks.
Contact me Directly for More Information
Nick Andriacchi
Chief Revenue Officer – Madison Resources
(312) 933-7712
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About the Author
Nick Andriacchi is the Chief Revenue Officer at Madison Resources, bringing over 30 years of experience in the funding and payroll industry. Before joining Madison, Nick held leadership roles at two other funding companies, where he built a reputation as a trusted advisor and strategic thinker. Widely regarded as a true industry expert, Nick is passionate about helping staffing firms grow through smart funding solutions and operational support.
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