The benefits and challenges of contract and temporary staffing in the US.JPG
02 Oct

The Staffing industry in the United States is the largest single industry for temporary and contract staffing, followed by Japan and the UK. The industry reached its highest mark during the coronavirus and was even stronger in 2022 by creating a worth of nearly 220 billion U.S. dollars. 

Staffing agencies are those agencies that help organizations find the right resource for a given job profile. These services are offered in various domains, contract and temporary staffing being the widely used staffing services. In this blog, we shall discuss the benefits and challenges of contract and temporary staffing services in the United States. 

Benefits of Contract Staffing and Temporary Staffing:

‘Contract Staffing’, as the word says, is the hiring of individuals on a contractual basis. Thus, these individuals are known as contract employees who work on a contractual basis for a specified time. Let’s have a look at some of the benefits of contract staffing:

  • Minimizing Costs
  • No long-term commitments
  • Flexibility
  • Accessibility to specialized skills
  • Cost Savings
  • Seasonal Hiring

Minimizing Costs

Hiring contract-based workers can help businesses in minimizing costs. As they are not permanent employees and do not require added benefits or insurance, all this helps in reducing labor costs. The hiring expenses are also less for the contract workers.

No long-term commitments:

In contract-based staffing, recruiters enjoy a hassle-free short-term commitment with the worker. They can hire them for a specified time or till the completion of a project and evaluate their performance to make decisions for future projects.


Contract-based staffing is a more flexible way of hiring workers as the business gets the flexibility to change their modus operandi or to make changes in their projects or their professional requirements.    

Much similar to contract staffing is temporary staffing. As the term describes itself, Temporary staffing is the process of hiring professionals on a temporary basis to meet the specific needs of the hiring organization. Temporary Staffing is also known as contingent staffing which requires the contingent workforce to operate on a temporary basis. Temporary staffing has several benefits for employers as well as employees. There are a few of the benefits of temporary staffing:

Accessibility to specialized skills:

Through temporary staffing, the employer gets accessibility to a pool of talented professionals offering a range of diverse and specialized skills. This, in turn, aids the hiring companies to benefit from such workers without hiring them as full-time employees.

Cost Savings:

Temporary Staffing is a more viable solution when it comes to cost savings. The expenses related to hiring a full-time employee and giving them added benefits is a hefty task. On the other hand temporary employees save a lot of additional resources for their employers.

Seasonal Hiring:

Temporary staffing can also be referred to as seasonal hiring because companies only tend to hire when they have requirements for a particular professional. In that sense, seasonal hiring can benefit employees as it can be an alternative to hiring employees for permanent roles.

Challenges of Contract Staffing and Temporary Staffing:

There are times when companies come across increased workloads and urgently require employees, temporary or contract staffing comes to the rescue in such situations. The numerous benefits that it holds for employers and employees make it the perfect choice when it comes to staffing.

However, temporary and contract-based staffing solutions also have their drawbacks. Let us look into some of them:

A relationship that doesn’t last:

One of the challenges of hiring temporary workers is that the employee cannot make a lasting relationship with the company. The relationship only lasts till the company requires the worker for the project requirements. This may prevent the professional from becoming a loyal asset to its employee in the long term.

Adapting to the company culture:

Another challenge that comes up is helping the temporary employee adapt to the company’s culture and environment. As they only stay for a shorter period of time with the company, it becomes important for them to get well-versed in the policies, culture, and structure of the company. This ensures that they work with more clarity and comfort. However, in some cases due to the lack of time, this is not possible and the employee may feel underinformed. 

Uncertainty at work:

As the employees are aware that they are hired for a temporary job role, the risk of being unemployed after a certain period of time may cause a sense of uncertainty and affect their performance at work. This in turn can reduce the chances of skilled professionals opting for temporary roles which leads to a decrease in the overall number of skilled professionals available to work on a temporary basis. 

Lack of Loyalty towards the employer:

It’s extremely rare for the temporary employee to be willing to take the extra mile for the employer. As they are aware of the temporary nature of their work, this can result in a lack of engagement and less loyalty toward work.

 Communication Barriers:

The company should ensure that the employee gets the opportunity to communicate with the entire team effectively without feeling left out or ignored. In such cases, the productivity of temporary and permanent team members may get hampered.

 Overcoming the challenges of contract and temporary staffing 

Though there are numerous benefits as well as challenges that come with contract and temporary staffing, it is necessary to overcome the hurdles by being proactive. Here are some measures which can be planned ahead when faced with the challenges:

  • Requisite training and Support
  • Incentives and Recognition
  • Opportunities for career development and skills training 
  • Bonding well and integrating them into the team
  • Clear Communication

By keeping these overcoming factors in mind, employers can expect temporary  professionals to procure better results and add value to the growth of the organization. 


With the rise of temporary and contract-based staffing, the staffing industry is evolving exponentially. Furthermore, temporary staffing and contract staffing solutions provide numerous benefits like cost savings, flexibility, offering specialized skills, and seasonal hiring among others. It also comes with various challenges like limited loyalty in employees, no lasting relationships, and employee demotivation. The only solution to fight back and overcome such challenges is to be mindful and take into account such hiring practices that create opportunities for such temporary employees.

By encouraging and embracing temporary employment and overcoming its challenges, the opportunities for such a job market can be increased. This will thus benefit the employees as well as the hiring employers. Moreover, temporary staffing can be the best choice for the employees as well as the employers if such staffing types align with their business goals. It helps in acting as an alternative to hiring a full-time employee and works as a flexible option in uncertain times.

Getting the best staffing agency is also necessary when it comes to hiring the right workers for your business. InstantServe LLC is one such leading staffing agency that provides staffing and recruiting services in the United States. It focuses on bringing the best answers for its clients and candidates. For more information, you can visit the website and check out the services we provide or book an appointment with us.

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